David Friedberg
Appearances
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
Guys, just give me one second. Can I just ask... Make one comment. I've been here for like 40 minutes. Yeah, tried to get you in. I want to respond to the inflation point, Mark. I just shared two images. First was the U.S. crude oil production chart. And more than half of this oil is exported. So you can see the reduction in production, but the domestic oil production...
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
capacity remain high relative to our consumption. So US consumption, if oil was the biggest driver, it really would have affected the profits of the exporting companies, not necessarily the cost of energy domestically. I will, however, point out that the Federal Reserve's balance sheet swelled during COVID from $4 trillion to $8 trillion. And as we all know, there was significant
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
fiscal stimulus, meaning the federal government bought a ton of shit.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
Well, I would argue that flooding the world with dollars, which is what the Federal Reserve did because they bought up all the bonds as the federal government started to issue money in lots of different ways, caused the supply of dollars to go up, which causes the cost of anything that's dollar-denominated to grow up.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
And I think many economists would argue and make the case that the fiscal policy and the monetary policy of the federal government and the Federal Reserve is largely to account, and I'm not going to use the word blame, but to account for the inflation we saw in the cost of everything from energy to production to labor to assets and so on.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
They're not they're not but there was also significant as we can all acknowledge, massive in a dynamical system. Global supply chains are a dynamical system stuff is made in one place move to another place. When one thing breaks, or it slows down, it all breaks and we had a massive shortfall of goods around the world. And that was the biggest driver of the inflationary effect that we saw.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
No good production went down in everything, not just energy, but everything and not because of energy, but because of a lot of other reasons.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
And then and then we had a whiplash problem where we had over demand relative to the natural and none of the production systems could keep up with demand stimulus.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
Yes, of course. And fiscal and monetary policy.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
Stimulating the world economy by pouring a shit ton of money out that's never happened in history, right? For sure, 100%.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
He did make that declaration against his own party, Mark. And he said, this is the wrong thing. As a Democrat, he said, this is the wrong thing to do. And they went forward with what they planned to do for various reasons. Some would argue political, some would argue that they thought it was the right thing to do. And the effect was precisely as Larry had predicted.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
No, absolutely not. Hey-o! Wow.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
What about the border, Mark? Because you made a comment about the border and she was declared the border czar.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
There's another theory, an economic theory, Mark, which is that it increases... the base of workers when we're at our lowest unemployment rate in history, and inflation is raging. So by bringing in low-cost workers that you're able to get to work at a lower wage rate, you actually have a deflationary effect and a stimulatory effect because then they end up being spenders as well.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
And that shouldn't be an executive authority, right? I mean, that should be like a legislative congressional authority that makes that decision and that determination on whether to change immigration policy. Do you think that the executive branch should be able to unilaterally determine who comes into the country without following laws?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
The encounters are not just.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
And so... Does the Harris campaign agree on that point? Or do they have a point of view?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
Mark, let me ask you just a point on arithmetic, which I think is the most important arithmetic we should all be talking about. Today is the first... Yesterday was the first day of the federal fiscal year, right? And here's a little image for us to all look at together as a group, an image that everyone should wake up every morning in the United States and look at.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
The first thing they do instead of looking at Twitter is they should look at the image that I'm sharing on the screen. right now, which is federal debt in the United States.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
Federal debt now stands at $35.7 trillion. And the biggest challenge we have in the year ahead is that 10 trillion of the outstanding debt comes up for refinance. It's going to refinance at around 4%. So we're going to be adding another $300 billion in new interest expense next fiscal year.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
Plus, the Biden administration has proposed a $7.2 trillion budget for next year, which will inevitably lead to another $2 trillion of deficit spending, which means that by the end of 2025, we could be staring at $40 trillion of federal debt.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
And if you do the math on that at 4% interest, it's 1.6 trillion a year of interest expense a year, just on interest expense on the outstanding debt, which effectively begins to eclipse the entire federal budget very quickly, and gives us no ability to maneuver to meet the needs of all the policy demands that are being described and shaped in all of these elections and all of these debates and all the bullshit that's going on is really not fundable.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
What does the Harris campaign say about the situation with respect to deficit spending and debt? And I don't know how high you can raise taxes and not cut spending to even make a dent in the challenge ahead without driving a massive recession. What do you think the Harris versus the Trump campaign's kind of intentions are as we look at this abyss that we're now kind of jumping into?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
There's a limit on tax, basically, right? Like that people will vote for.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
Do you support Elon Musk going in? If you're saying shed regulatory burden, shed inefficiency, improve productivity, don't we need an Elon Musk style model that Trump has talked about with Elon? Send someone in and let's go fix the inefficiency across all of the administrative efforts run by the federal government.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
Well, I think that triggers a recession because then you got a lot of people unemployed, right?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
Are you just trolling? Are you just trolling? Are you just trolling David Sachs? I can't keep up with the trolling. I think I need to ask Trump to control the trolling. Nested trolling.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
Mark is actually supporting Trump. He's just trolling Sachs and coming on the show.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
That's pretty, that's pretty interesting.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
Well, I want to know about, are you investing in AI technology? Where are you investing in the stack? How do you think about that? Are you an active venture investor, Mark? I mean, I know we've obviously done some stuff together, but I'm curious how you look at stuff.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
I think we all have a piece of that now.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
And instead, we open source it to the fans and they've just gone crazy with it. Love you, Wes. I swing again.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Mark Cuban
They just need to release that now.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
And it said, we open sourced it to the fans and they've just gone crazy with it. Love you guys.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
I don't think that pre the emergence of the pandemic, that there was nefarious motives
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
It might have been a mistake in hindsight, but... Yeah, for many years, particularly following the original SARS pandemic, there was a lot of conversations around how do we get in front of the next pandemic? How do we figure out what's coming? And how do we prepare for it? And there was a lot of research that was launched to try and resolve that key question. This is like the movie 12 Monkeys.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
You guys ever see that movie? I think at one point. Yeah, sure. It's like, does the effort to try and stop the problem cause the problem?
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
I think that from my point of view, there's a very high probability that there was some leak that meant that the work that was going on to try and get in front of the next pandemic and understand what we could do to prepare ourselves and what vaccines can be developed and so on actually led to the pandemic. So then when that happens, how do you respond when you're sitting in that seat?
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
That's, that's the key question that I think this committee is uncovering.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
Yeah, I think that these guys definitely didn't want, I think what they were trying to do was prevent that from being the focal point and protect their own asses at the same time. Do you think they should go to jail? I don't know the extent of it yet. It'd be good to get more information from this whole thing.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
I will say this guy that gave testimony last week where he was like deliberately changing the names of people in the email, Anderson, and he put the dollar sign so that you couldn't find that email when you did a FOIA search. He knew what he was doing.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
What would you guys do if you're sitting in a policymaker's seat today and you're being offered by scientists this ability to go and figure out what the next big virus will be and start to make plans for getting in front of it by understanding the biology of these viruses, by seeing where they're going to evolve to, and by trying to get in front of the next pandemic so that we can
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
protect the population? Do you guys support that sort of research? And what are the questions you ask? So let's, you know, rewind 15 years, pretend Fauci doesn't get to make those decisions. You guys are the policymakers. And folks say SARS just happened. We want to do this research. We want to figure out how to get free.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
So, Sax, I am going to push back because that is not conclusively true. What you're saying is something that some people have claimed, but there are other scientists, including papers published recently in The Lancet and other pretty reputable medical journals and research journals,
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
that indicate that the evolution seen in the fear and cleavage site can be traced back to an evolutionary origin, not necessarily to a human engineered origin. So I want to just make that clear that that is a possibility. I'm not dismissing it, but I'm not supporting the other side. I'm saying we have work to do to figure this out, just to be clear.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
I want to ask you guys, what do you do? So forget about, oh, there's bad guys, Fauci's a bad guy. What do you do to protect the world against the next pandemic?
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
So first of all, who's we?
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
The Saks coin is down to eight grand.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
Well, I think the key question to your point is they're a macroeconomic reason for a slowdown in their business. They're forecasting for this next fiscal year, revenue growth of only 8% to 9%. And for this next quarter, it's basically a flat revenue quarter relative to the past quarter. So for this fiscal year, $38 billion of top line revenue, $9 billion of operating cash flow.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
And with the market cap coming down by 20%, the stock's at a $200 billion valuation. So it's trading at, you know, call it roughly 20 times their operating cash flow forecast with sub 10% revenue growth. And that's basically where treasuries trade, right? Because treasury yields... For a 30-year treasury, you can get 4.7% today.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
That's about 20x, right? So that's about where the multiple is on this Salesforce stock. So I think it really begs the question on, is there a macroeconomic force where the enterprise is spending less because of a revenue slowdown in the economy, which we saw in the latest GDP report.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
That's number one that could be driving this and will affect ultimately the multiple for all these enterprise SaaS companies. Or number two, is there a shifting underway in the SaaS business model that the premium that SaaS companies were able to charge in the pricing model on a per seat basis and the dollars that they're able to charge per employee or per user
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
is so significant relative to what that enterprise can build themselves now with the commoditization available to them under this new era of AI and the ability to build tools internally or the ability for competitors to emerge with significantly underpriced alternatives because they can use generative AI to make software that can compete.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
And then there's this other question, because Salesforce has been leaning in heavily on the generative AI capabilities that they're offering their customers. And it seems like the question is, are enterprises waiting to see the value of that generative AI service capability? Is it worth paying for today? Should I wait and see?
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
Or is it actually indicating that there's a big commoditization and generative AI underway?
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
Meaning, why do I have to pay Salesforce a bunch of money when I can use some open source third-party tool or some more freely available tool?
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
Yeah, I mean, if you look at this, we are at, what is it, 3.6% annualized CPI inflation and 1.3% annualized GDP growth. and a 4.7% 30-year treasury yield. This is, I don't know what else is more definitional of stagflation. The economy is not growing, prices are going up, and the cost to borrow has gone through the roof.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
Just to jump back for a second on the Salesforce point. So, you know, Salesforce faces these challenges, but it's still led by Mark Benioff. Absolutely. That dude's tremendous.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
And if you look at the performance of the average public company, regardless of the sector that that business operates in, that is run by a hired CEO versus run by a founder CEO, the founder public companies that have gone public, achieved a $10 billion market cap, and are still founder run as the CEO from there, outperform nearly any index you look at.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
Good for you. Sorry, I'll just say, I've heard the same thing and I told friends and others that have reached out, why are you associating yourself with people that are doing a fundraiser for Trump?
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
And this is, I think, like a really key point. You could probably put together, I think some people have done this, put together a founder portfolio, but I wouldn't count out Benioff just because of some of the stuff that we've talked about. That's my view. Founders can and will maneuver their way to success. That is the hunger of the entrepreneur.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
I don't know the, I mean, all these founders, I don't know how to pick one. I mean, what are you asking?
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
And I said, exactly because I think it's really important that people can have different political interests, different points of view, different beliefs, and still be friends and still have a conversation. If we can model that in any way,
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
I think it moves the needle because this whole thing where you only speak with, only hang out with, only talk to, only have dinner with people that you agree with, I think is exactly what got us in the mess that we're in today. People need to have a broader perspective.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
Freeberg, your take. No, I mean, it felt like this was always a win-win trial for Trump. If he gets convicted, then, you know, the conversation that we're hearing now, you know, this was an unfair conviction. How could they do this? This is lawfare. And if he doesn't get convicted, they tried to burn him at the stake. How could they try and do that? Clearly he's innocent. He was made innocent.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
So, you know, it never really struck me as being a smart, I'm not a political guy, but the political calculus just seemed off on this entirely. It certainly wasn't clear what they were trying to accomplish. Either way, Trump looks good. And I think we saw tonight reports that his website for making donations crashed.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
A lot of people started making public statements on Twitter that are not typically Republican donors, that they're donating a lot of money to Donald Trump coming out of this. And so it is clearly infuriating a lot of people that, as Sachs points out, you know, something that some people are considering to be, you know, a bookkeeping or accounting crime has turned into 34 felony convictions.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
It feels unfair. It feels like the wrong decision. And it's going to infuriate people because people worry about the quality of the justice system. Anyone who's sitting in the middle as an independent or an undecided, I think it is much more likely that they are going to have sympathy for Donald Trump coming out of this, not admonishment.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
And I'll support you guys with whatever in terms of like being your friends. I'm not going to ever judge you guys in terms of what you believe in or choose to do.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
Not just SaaS, but also Dell. And in particular, Dell reported their stock is down 20% after hours. So I do wonder if there is a slow reckoning underway right now in technology markets That's, as we talked about in the show, a function of both kind of an economic slowdown, so enterprises making fewer investments, but they clearly called out the increased cost associated with AI.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
So they are spending quite a lot and their COGS on AI systems is much higher And so they're showing a lot more cash burn. And I think this is to Chamath's point. Chamath's been talking for a while.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
I think the market is sort of like saying- Well, I think the general statement might be made that perhaps the first AI mini bubble is bursting a bit.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
And particularly with respect to the accelerated expectations that public market investors had for public market technology stocks, that perhaps now is the time for a bit of a reckoning, that perhaps this isn't going to happen at the same margin level or the pace that folks had modeled. And this is going to cause a bit of a setback. I think pace is a very good point you're making.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
I also think that with the GDP slowdown that we've seen report that just came out this week, with a sub 2% US GDP growth, we are seeing an economic slowdown underway. There is going to be reduced spending. There is going to be reduced conversion of enterprise customers to buy anything. And so that is going to dramatically affect the market.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
We're looking at 5% 30-year treasury rates, which means that you are going to see multiple compression that's going to happen across the market for tech stocks. So this could be the beginning of what I think might be a slow contraction.
All-In with Chamath, Jason, Sacks & Friedberg
Trump verdict, COVID Cover-up, Crypto Corner, Salesforce drops 20%, AI correction?
fans and they've just gone crazy with it. Love you, Wes.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
Sorry, just real quick. Do you think there's one LLM or one foundational model read that effectively does everything like a meta model that starts to take most of the market or does different... versions of smaller models or small agents that kind of network together, end up being the best solution for specific applications and verticals. Like how does this evolve over time?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
Like everyone's got this concept that there's a God model that does everything and wins. And whoever gets the God model wins everything. But the reality of software and principles of biology would indicate that you'll see like smaller network things that are better at doing things than any one big thing. And I'm curious to hear your point of view on the philosophy of that.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
Or language translation, right? If I just want to do language translation, I don't need a massive model. I just need a model that's really good at language translation. Exactly.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
Do you feel the voters felt, Reed, do you think the voters felt left out? the Democratic voters?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
I would have liked to have that speed run. Do you think it sets a bad precedent that there were these back room conversations? Obviously, The staff of Whitmer, Moore, Shapiro, their office speaks with Democratic Party leadership, speak with big donors.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
And there was effectively a coalescing that took place over a period of time that said, we should all stand behind and endorse one person instead of infighting and creating a split in the party. And does that not set a bad precedent that there is a small group of people in either party...
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
that in a primary process effectively get to nominate their candidate, get their candidate to become the nominee. And therefore there's only two people for the country to choose from. And as we have seen recently with RFK Jr. and the lawsuits against him in being on the ballot in different states, it makes it very difficult maybe for the people to have their choice.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
And is that a bad way for democracy to work? And I just love your philosophical view on this. I'm like, what's the best way for democracy in the United States to work?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
Because you give money to folks that then execute their own strategies. So you can't control on the ground tactics, right?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
So there's that happens that you're like, no, don't do that.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
Reid, do you think that, generally speaking, Marxist socialist principles are taking a firmer hold on the Democratic Party? And kind of those principles are starting to showcase not just in the cultural phenomena that Chamath is referencing, but also in some of the policymaking that's going on, and concepts of equity
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
rooted in concepts of social justice, ultimately rooted in Marxist principles emerging from the Industrial Revolution. What about price fixing? So as an example, the price gouging, you know, price caps on food proposal,
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
the concepts of a wealth tax, not necessarily the unrealized capital gains tax, but separately a tax on wealth, all of these concepts of the degradation of power structure through policy. And in part, some have argued that the antisemitism arises from these principles and that the Jews are considered a privileged and powerful cultural class. Is that not being observed?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
Do you not think that there's some tendencies that are emerging in the Democratic Party and maybe influenced by a louder far left and that far left is becoming more loud and better represented in the party?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
Driven by fuel and labor and all the other inflationary underpinnings of those markets. And I think we tried to highlight that. I don't know if you saw Elizabeth Warren's interview on CNBC where she got taken apart because she made some claims about profiteering by Kraft Heinz. And the CNBC anchors pointed out you were actually incorrect.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
Kraft Heinz has seen a reduction in profit over this period of time. And so there were factual inaccuracies in these belief systems. But for me, it feels a lot like the government setting prices in free markets is one of those steps towards socialist principles that worry me the most.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
Yeah, if 80% or more is illiquid, then... No, you get to defer the tax, but there's a penalty. Yeah, you get to defer the tax credit as a penalty. That's right.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
By the way, what Sachs didn't address is Trump's tariff policy, which is also inflationary, almost equivalent to the price gouging, you know, food price caps. I think that they're both inflationary and they're both bad policy. That's my personal point of view. Tariffs is where I thought it was going to go. Yeah. Anyway. Yeah.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
That's different. That's different. That's a subset. That's a different group. That's a group to counteract you and Chamath. Throwing us fundraiser for Trump.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
We're rolling into an interview with R.F.K. Jr. It wasn't designed this way. The last minute R.F.K. It's just that last minute R.F.K. Jr., who's on vacation, said that he would talk to us about what it was like to kind of withdraw and all this sort of stuff. So we booked it right after you, but he's in the waiting room.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
Yeah, there are aspects of industrialized food and processed food that are bad for people. And I do agree, it should be changed. I know a lot of people that work at the USDA, a lot of people that work in other government organizations that don't make a lot of money. They may or may not have worked at other companies, but I think that there's no economic incentive for them to do harm or wrong.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
So I don't think that there's a constructive design on doing bad things by any individual. I think that there is an unfortunate circumstance where people eat bad stuff
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
stuff that tastes better they like it more it sells better and the economic incentive and capitalism is to make more of that stuff and sell more of it and as a result the stuff that people like that isn't good for them they buy more of and the companies make more money and so they continue to invest in selling more and more of that stuff and this goes in most processed foods it's terrible it's not good and so i do agree that much of this processed food industry is um
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
very adverse to health, but I don't think that there's a grand design by individuals that are malicious in their intent in trying to do it. I think that there are people that are doing their job on, hey, this is what the market wants, let's give them more.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
No, no, I think that, yeah, the point is, like if people buy more of it, they're like, let's sell more of it, you know? Yeah, okay. And if that were illegal, if it was illegal to say, hey, this sort of food product should not be made, but look, alcohol fits the bill too, right? And we keep making alcohol and sugar fits the bill. The more sugar, Coca-Cola did a study years ago
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
where they kept increasing the amount of sugar in Coca-Cola until they maximally got sell-through. So some kids liked 60 grams of sugar in 12 ounces of Coke, some kids liked 30, but the perfect level was at 42 grams. And so that study was done by the scientists that worked at Coca-Cola, and then they said, that's the product, it'll sell the most. And that's the incentive inside of that company.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
That's how that company operates. Now, you could ask yourself the question, is that evil? Is that bad? We now know that sugar in general is bad. The executives at Coca-Cola, at AB InBev, at other places are trying to make alcohol-free, sugar-free alternatives. So there's a lot of push by these people. Unilever has tried to make a big push towards good food. Nestle's tried to do the same.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
They've all made these stated commitments to improve the health of the food that they produce. But it is quite difficult to be successful in doing that and returning money to shareholders. The shareholders are like, where's the money?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
What's the price of the food, Chamath? Is it more in Italy? Do you pay more, do you think? I've already commented on this.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
I don't know if there's competition in the build-out. I think we talked about this in the past. And I don't know if you guys saw these quotes this week or recently on, we don't think about this build-out in terms of ROI. Gavin Baker in conversation on Invest Like the Best, is that the name of the podcast? Yeah.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
I think referenced some conversations he's been having with the leaders of these companies regarding the build-out is so important because ultimately, if you create this, quote, digital god, the return is how many trillions. So it doesn't matter how many tens of billions you're spending each quarter right now. You have to get there. You have to make sure you don't miss the boat.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
I will agree on an important point. The food stamp program, the SNAP program, provides food stamps to support 42 million Americans. 42 million people rely on food stamps. It costs $120 billion of federal money per year. And as, as Bobby said, the number one product bought on the food stamp program is soda, canned soda.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
I guess, Reid, a question for you. You're on the board of Microsoft still, right? Yes, indeed. Has Microsoft or Satya publicly talked about how they rationalize the investing principles associated with building out AI infrastructure in the cloud? Is it ROI based? Like, hey, in the next two years, we're going to make this much additional incremental operating profit?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
And there was an important debate a few years ago about whether or not canned soda, by the way, Bobby, you and I probably agree on a lot of things. It's definitely a lot of things we don't agree on. But like, these aspects, I think, are just no brainers. There was a debate a few years ago about whether or not canned soda should be allowed as a purchase on the food stamp program.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
or whether it should be fresh fruits and vegetables and grains and other things. And ultimately there was a food lobbying effort made that kept canned soda on the food stamp program. And it is, again, $120 billion of annual federal spend with the biggest line item going to canned soda to feed 42 million Americans. And the connection is completely direct.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
high sugar, high glycemic index, diabetes, and other chronic health conditions arise from that connection. So definitely aligned with you on the misincentives and the disincentives in these programs that have been created. And they only expand every year.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
Or is it like, hey, we got to get this thing working?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Reid Hoffman & Robert F. Kennedy Jr.
Two- All cloud computing platform companies, what's your sense on how they're thinking about it?
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Yes.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
01 is a game changer. Yes. It's the first real chain of thought production system that I think we've seen.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
in order to give the answer. This is called chain of thought. Right. And this is the underlying mega model that sits on top of the LLMs. And the mega model, effectively, the chain of thought approach is the model asks itself the question, how should I answer this question? Right. And then it comes up with an answer.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And then it says, now, based on that, what are the steps I should take to answer the question? So the model keeps asking itself questions related to the structure of the question that you ask. And then it comes up with a series of steps that it can then call the LLM to do to fill in the blanks, link them all together and come up with the answer.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
It's the same way that a human train of thought works. And it really is the kind of, ultimate evolution of what a lot of people have said these systems need to become, which is a much more, call it intuitive approach to answering questions rather than just predictive text based on the single statement you made. And it really is changing the game and everyone is going to chase this and follow this.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
It is the new paradigm for how these AI kind of systems will work.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
This is like the photo in Back to the Future.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
By the way, it's not just call centers. I had a conversation with, I'm on the board of a company with the CEO the other day. And he was like, well, we're gonna hire an analyst that's gonna sit between our kind of retail sales operations and figure out what's working to drive marketing decisions. And I'm like, no, you're not.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Like, I really think that that would be a mistake because today you can use O1 and describe, just feed it the data and describe the analysis you wanna get out of that data. And within a few minutes, and I've now done this probably a dozen times in the last week with different projects internally at my company,
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
it gives you the entire answer that an analyst would have taken days to put together for you. And if you think about what an analyst's job has been historically is they take data and then they manipulate it.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And the big evolution in software over the last decade and a half has been tools that give that analyst leverage to do that data manipulation more quickly, like Tableau and R and all sorts of different toolkits that are out there. But now you don't even need the analyst because the analyst is the chain of thought. It's the prompting from the model.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And it's completely going to change how knowledge work is done. Everyone that owns a function no longer needs an analyst. The analyst is the model that's sitting on the computer in front of you right now. And you tell it what you want. And not days later, but minutes later, you get your answer. It's completely revolutionary in...
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
ad hoc knowledge work as well as kind of this repetitive structured knowledge work.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
That's all reportedly out of some article, right? That's not like confirmed or anything.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
There was some article that reported this, right? None of us have firsthand.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
There's probably also an aspect of this that we can't predict what is going to work with respect to data structure. So right now, all of... all of the tooling for AI is on the front end.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And we haven't yet unleashed AI on the back end, which is if you told the AI, here's all the data ingest I'm going to be doing from all these different points in my business, figure out what you want to do with all that data. The AI will eventually come up with its own data structure and data system. No, that's happening. That will look nothing like... No, no, that's already happening. Right.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And so that's nothing like what we have... today, in the same vein that we don't understand how the translation works in an LLM, we don't understand how a lot of the function works, a lot of the data structure and data architecture, we won't understand clearly, because it's going to be obfuscated by the model driving the development.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
So maybe it's being done, right.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
You can't raise $6 billion without probably meeting with a few dozen firms. And some number of junior people in those few dozen firms are having a conversation or two with reporters. So you can kind of see how it gets out.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
This is the Rogan clip? No, this is Congress. Watch this. This is what is in Congress.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
No.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Delaware.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And do you think this could become an absolutely zero idea? I have no idea what they're doing. I don't know how they're converting a nonprofit to a for profit. None of us have the details on this. There's there may be significant tax implications, payments they need to make. I don't think any of us know. I certainly don't. I don't know if there's actually a real benefit here.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
If there is, I'm sure everyone would do it. No one's doing it. So there's probably a reason why it's difficult. I don't know.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Did Elon actually put in $50? Did he put in $50 million?
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
The argument that I heard was that Elon was given the opportunity to invest along with Reid, along with Vinod. And he declined to participate in the for-profit investing side that everyone else participated in.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Well, I think it ties in a lot to the AI discussion because I think we're really witnessing this big shift from this big transition in computing, probably the biggest transition since mobile. You know, we moved from mainframes to desktop computers. Everyone had kind of this computer on their desktop, but you used a mouse and a keyboard to control it.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Yeah. A bunch of comments asking. Jake, why do you call it Alex Jones?
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
To mobile, where you had a keyboard and clicking and touching on the screen to do things on it. And now to what I would call this kind of ambient computing method. And, you know, I think the big difference is control and response. In directed computing, you're kind of telling the computer what to do. You're controlling it. You're using your mouse or your keyboard to go to this website.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
So you type in a website address. Then you click on the thing that you want to click on. And you kind of keep doing a series of work to get the computer to go access the information that you ultimately want to achieve your objective. But with ambient computing, you can more kind of cleanly state your objective without this kind of directive process. You can say, hey, I...
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
I want to have dinner in New York next Thursday at a Michelin star restaurant at 5.30. Book me something and it's done. And I think that there are kind of five core things that are needed for this to work, both in control and response. It's voice control, gesture control, and eye control are kind of the control pieces that replace, you know, mice and clicking and touching and keyboards.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And then response is audio and kind of integrated visual. which is the idea of the goggles. Voice control works. Have you guys used the OpenAI voice control system lately? I mean, it is really incredible. I had my earphones in and I was like doing this exercise. I was trying to learn something. So I told OpenAI to start quizzing me on this thing. And I just did a 30 minute walk.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And while I was walking, it was asking me quiz questions and I would answer it and tell me I was right or wrong. It was really this incredible dialogue experience. So I think the voice controls there I don't know if you guys have used Apple Vision Pro, but gesture control is here today. You can do single finger movements with Apple Vision Pro. It triggers actions. And eye control is incredible.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
You look at the letters you want to have kind of spelled out or you look at the thing you want to activate and it does it. So all of the control systems for this ambient computing are there.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And then the AI enables this kind of audio response where it speaks to you and the big breakthrough that's needed that I don't think we're quite there yet, but maybe Zuck is highlighting that we're almost there and Apple Vision Pro feels like it's almost there, except it's big and bulky and expensive is integrated visual where the ambient visual interface is always there and you can kind of engage with it.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
So there's this big change. I don't think that mobile handsets are gonna be around in 10 years. I don't think we're gonna have this like phone in our pocket that we're like, pressing buttons on and touching and telling it where on the browser to go to, the browser interface is gonna go away.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
I think so much of how computing is done, how we integrate with data in the world and how the computer ultimately fetches that data and does stuff with it for us is gonna completely change to this ambient model.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
So I'm pretty excited about this evolution, but I think that what we're seeing with Zuck, what we saw with Apple Vision Pro and all of the OpenAI demos, they all kind of converge on this very incredible shift in computing. that will kind of become this ambient system that exists everywhere all the time.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And I know folks have kind of mentioned this in the past, but I think we're really seeing it kind of all come together now with these five key things.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
I saw Joe Rogan 25 years ago doing stand-up. I have a photo with him at the club. It was like a small club in San Francisco and we hung out with him afterwards. He was just like a nobody back in the day. He was like a stand-up guy, right? Now he's a media uber star.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
You need some visual interface. I think the question is, where is the visual interface? Is it in the wall?
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Well, when you're asking, I want to watch Chamath on Rogan. I don't just want to hear, I want to see. When I want to visualize stuff, I want to visualize it. I want to look at the food I'm buying online. I want to look at pictures of the restaurant I'm going to go to.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Fear Factor, that's right.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
If you think about like, so take the constraints on, I don't need a keyboard because I'm not gonna be typing stuff. I don't need a normal browser interface. You could see a device come out that's almost like smaller than the palm of your hand that gives you enough of the visuals and all it is is a screen with maybe two buttons on the side. And it's all audio driven.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
I feel like that's where he blew up. UFC, yeah.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
You put a headset in and you're basically just talking or using gesture or looking at it to kind of describe where you want things to go. And it can create an entirely new computing interface because AI does all of these incredible things with predictive text, with gesture control, with eye control, and with audio control.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And then it can just give you what you want on a screen and all you're getting is a simple interface. So Chamath, you may be right. It might be a big watch or a handheld thing that's much smaller than an iPhone. And just all it is is a screen with nothing.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
I think social fabric's more affected by people staring at their phones all the time. You sit on a bus, you sit at a restaurant, you go to dinner with someone and they're staring at their phone. Like spouses, friends, we all deal with it where you feel like you're not getting attention from the person that you're interfacing with in the real world because they're so connected to the phone.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
If we can disconnect the phone, but still take away this kind of addictive feedback loop system, but still give you this computing ability in a more ambient way that allows you to remain engaged in the physical world. I think everyone would feel a lot better about it. You could say it.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And that's the opportunity. If you guys play with Apple Vision Pro, have any of you actually used it to any extent? No, I used it for a day.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Right, which I get, but I do think that it has these tools in it, similar to the original Macintosh had these incredible graphics editors like MacPaint and all these things that people didn't get addicted to at the time, but they became this tool that completely revolutionized everything in computing later. and fonts and so on.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
But like this, I think has these tools, Apple Vision Pro, with gesture control, and the keyboard and the eye control, those aspects of that device highlight where this could all go, which is this, these systems can kind of be driven without keyboards without typing, without like, you know, moving your finger around without clicking.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
You don't need to control the computer anymore. The computer now knows what you want. And then the computer can just go and do the work.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
How is OpenAI worth $150 billion? Can anyone...
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Look at the Apple Newton, dude. The Apple Newton is like perfect. Exactly, people forget about that. And then it turns out, hey, you throw away the stylus and you got an iPhone, right? And everything gets a million X better.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Should we make the bull case and the bear case?
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
99, 2000, that era.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Anyway, we're definitely on this path to ambient computing. I don't think this whole like, hey, you got to control a computer thing is anything my kids are going to be doing in 20 years.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
It's the same thing.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
External stakeholders, yeah. So like the environment or society or whatever. But from all other kind of legal tax factors, it's the same as a C Corp.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Well, yeah, I think the market's definitely correcting itself. I think for years, as Chamath said, there was kind of this belief that if you went to college, there was, regardless of the college, there was this outcome where you would make enough money to justify the debt you're taking on. And I think folks have woken up to the fact that that's not reality.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Again, if there was a free market, remember, most people go to college with student loans and all student loans are funded by the federal government. So the cost of education has ballooned and the underwriting criteria necessary for this free market to work has been completely destroyed because of the federal spending in the student loan program.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
There's no discrimination between one school or another. You can go to Trump University Or you could go to Harvard, it doesn't matter, you still get a student loan, even if at the end of the process, you don't have a degree that's valuable. And so I think folks are now waking up to this fact and the market is correcting itself, which is good.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
I'll also say that I think that there's this premium with generally mass production and industrialization of the human touch. And what I mean is, if you think about, hey, you could go to the store and buy a bunch of cheap food off of the store shelves, you could buy a bunch of Hershey's chocolate bars.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Or you can go to a Swiss chocolate here in downtown San Francisco, pay $20 for a box of handmade chocolates, you'll pay that premium for that better product. Same with clothes, there's this big trend and kind of handmade clothes and high end luxury goods spoke artisanal Artisanal, handmade. And similarly, I think that there is a premium in human service, in the partnership with a human.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
It's not just about blue collar jobs. It's about having a waiter talk to you and serve you. If you go to a restaurant, instead of having a machine spit out the food to you, there's an experience associated with that that you'll pay a premium for. There's hundreds and hundreds of microbreweries in the United States that in aggregate outsell Budweiser and Miller and even Modelo today.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And that's because they're handcrafted by local people and there's an artisan craftsmanship. So while technology and AI are going to completely reduce the cost of a lot of things and increase the production and productivity of those things... One of the complementary consequences of that is that there will be an emerging premium for human service.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And I think that there will be an absolute burgeoning and blossoming in the salaries and the availability and demand for human service in a lot of walks of life. Certainly there's all the work at home, the electricians and the plumbers and so on, but also fitness classes, food, personal service around tutoring and learning and developing oneself.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
There's going to be an incredible blossoming, I think, in human service jobs, and they don't need to have a degree in poli sci to be performed. I think that there will be a lot of people that will be very happy in that world.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Well, these are in-person human jobs. So if I want to do a fitness class, do I want to stare at the tonal?
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
I think that there's an aspect of... Look, it's like your Laura Piana. You talk about the story of Laura Piana. Where is the vicuña coming from? How's it made? Who's involved in it? Yes, look, you're... Oh, God. Look at those. Here he goes.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
I could give you truffle flavoring out of a can, but you love the white truffles. You want to go to Italy. You want the storytelling. There's an aspect to it, right? Yes. And I think that there's an aspect of humanity that we pay a premium, that we do and will. Look, Etsy crushes. I don't know how much stuff you guys buy on Etsy. I love buying from Etsy. I love finding handmade stuff on Etsy.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Patagonia.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
No, you don't. Do you really?
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Handcrafted? Yeah, handmade. So I think that there's an aspect of this that in a lot of walks of life. I mean, I have so many jokes right now.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Have you guys taken music lessons lately? My kids do piano lessons, and so last year I started ducking in to do a 45-minute piano lesson with the piano teacher. There's just like a great aspect to paying for these services. It's fascinating you bring that up. Oh, here we go.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Did you see that interview with Bob Dylan? I don't know when it was, recently, about how... Oh, and Ed Bradley, that clip?
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
About magic?
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Let me just tell you something. I think there's going to be a big war. I think by the time this show airs, Israel's incursion into Lebanon is going to get bigger. It's going to escalate. And by next week, we could be in a full-blown multinational war in the Middle East.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And if I am, you know, a betting man, I would bet that the odds are, you know, more than 30, 40% that this happens before the election, that this conflict in the Middle East escalates.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And here's the situation. I really hope you're wrong. If Israel incurs further into Lebanon going after Hezbollah, And Iran ends up getting involved in a more active way. Does Russia start to provide supplies to Iran like we are supplying to Ukraine today? Does this sort of bring everyone to a line?
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Just to give you a sense of the scale of what Israel could then respond with, Iran has 600,000 active duty military, another 350,000 in reserve. They have dozens of ships, they have 19 submarines, they have a 600 kilometer range missile system.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Israel has 170,000 active duty and half a million reserve personnel, 15 warships, five submarines, potentially up to 400 nuclear weapons, including a very wide range of tactical sub one kiloton nuclear weapons, small payload. You could see that if Israel starts to feel incurred upon further, they could respond in a more aggressive way with what is by far and away
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
the most significantly stocked arsenal and military force in the Middle East. Again, we've talked about what are these other countries going to do? What is Jordan going to do in this situation? How are the Saudis going to respond? What is Russia going to do?
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Well, you know, so just to give you a sense- It's insane.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Yeah. So the nuclear bombs that were set off during World War II, I just want to show you how crazy this is. Do you see that image on the left? that all the way over on the left, that's a bunker buster. You guys remember those from Afghanistan and the damage that those bunker buster bombs caused? Hiroshima is a 15 kiloton nuclear, and you can see the size of it there on the left.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
That's a zoom in of the image on the right. And the image on the right starts to show the biggest ever tested was Tsar Bomba by the Soviets. This was a 50 megaton bomb. It caused shockwaves that went around the earth three times. They could be felt as seismic shockwaves around the earth three times from this one detonation. Today, there are a lot of
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
0.1 to one kiloton nuclear bombs that are kind of considered these tactical nuclear weapons that kind of fall closer to between the bunker buster and the Hiroshima. And that's really where a lot of folks get concerned that if Israel or Russia or others get cornered in a way, and there's no other tactical response that that is what then gets pulled out.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Now, if someone detonates a 0.1 or one kiloton nuclear bomb, which is gonna look like a mega bunker buster, what is the other side and what's the world gonna respond with? That's how on the brink we are. And there's 12,000 nuclear weapons with an average payload of 100 kilotons around the world. The US has a large stockpile. Russia has the largest. Many of these are hair trigger alert systems.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
China has the third largest. And then Israel and India and so on. It is a very concerning situation because if anyone does get pushed to the brink that has a nuclear weapon and they pull out a tactical nuke, does that mean that game is on? And that's why I'm so nervous about where this all leads to if we can't decelerate. It's very scary because you can very quickly see this thing accelerate.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
The bull case would be that the moat in the business with respect to model performance and infrastructure gets extended with the large amount of capital that they're raising. They aggressively deploy it. They are very strategic and tactical with respect to how they deploy that infrastructure.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
The waltz into World War III. is what it should be called.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
to continue to improve model performance and as a result, continue to extend their advantage in both consumer and enterprise applications, the API tools and so on that they offer. And so they can maintain both kind of model and application performance leads that they have today. Across the board, I would say like the O1 model,
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Their voice application, Sora has not been released publicly, but if it does, and it looks like what it's been demoed to be, it's certainly ahead of the pack. So there's a lot of aspects of of open AI today that kind of makes them a leader.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
And if they can deploy infrastructure to maintain that lead and not let Google, Microsoft, Amazon, and others catch up, then their ability to use that capital wisely keeps them ahead. And ultimately, as we all know, there's a multi-trillion dollar market to capture here, making lots of verticals, lots of applications, lots of products. So they could become a true kind of global player here.
All-In with Chamath, Jason, Sacks & Friedberg
OpenAI's $150B conversion, Meta's AR glasses, Blue-collar boom, Risk of nuclear war
Plus the extension into computing, which I'm excited to talk about later when we get into this computing stuff.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
I think the Optimus has the highest alpha, but the highest beta. So, you know, more upside than anything else. Just unclear how... You get there, what the path is and the capital requirements. And I think there's going to be a lot of commoditization in this space. But the ride sharing is built in. It's low beta and significant alpha.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
Yeah, optimist ride share.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
It was the original self-driving car company that Google set up. And then they set up Google X around it.
All-In with Chamath, Jason, Sacks & Friedberg
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Aurora was set up by Chris Urmson. He was the original engineering lead on Waymo inside of Google. When they did a management changeover, there was a big falling out. A lot of people ended up leaving the Waymo program. Chris left, took a bunch of people with him and started Aurora, which was basically software to do autonomous driving. that they were then going to license into OEMs.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
So that company got backed by a bunch of VCs and ended up going public via SPAC. And it's publicly traded today.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
They made an investment in it.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
But again, some of these guys are trying to make software for OEMs so that the OEMs don't have to build their own autonomous platform. And some of them are trying to make a driving service like Waymo. And then some of them are like Tesla has a driving car. They actually sell cars. So different models. Yeah. So they're all going to convert. Yeah.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
Yeah, they're cool. They just move around. You did take one. Yeah. They're all over the city. You can take them in San Francisco now.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
Yeah. And there's like a wait list and then you get on it and, you know, they're letting people on and then you just get on it and go for a ride.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
Friedberg, your thoughts? In California, non-competes are not enforceable, but outside of California, they are, and they're often used. Like in the agriculture industry,
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
industry in the ag inputs industry, where folks are developing new technology, mostly it companies based in the Midwest and East Coast, as you guys know, in financial services as well, they're often used that if you work for one company, because you have a lot of trade secrets, you can't carry them over to others.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
But in Silicon Valley, we're very used to engineers, product managers, executives, taking all of the knowledge and capabilities that they've developed at one business and leveraging that into a new role, it creates a dynamically competitive
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
marketplace it also inflates obviously costs because you're willing to pay more for someone who's worked directly at a competitor and has deep knowledge but they are bringing ip often and there is you know a real risk that they take something from your company that you've invested in them to understand then they take it to your competitor so i i see both sides of this i think non-competes
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
Give companies the ability to invest in employees and feel confident that the knowledge and information and support they're providing to those employees doesn't ultimately find its way over to a competitor. And it gives you a rationale for paying more to your employees. It actually inflates salaries.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
If I'm fearful that someone might leave and take knowledge with them, I'm going to share less with the employee. I'm going to pay them less. So I could see this going both ways. I'm really fairly torn on this issue. To be honest, I don't know what the right answer is. Or if there really is a strong kind of ethical case one way or the other.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
I think that non competes can both benefit and hurt employees and benefit and hurt companies.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
Did you ever see that movie Spanish Prisoner starring Steve Martin? Oh, yeah.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
God, that's a deep pull. Steve Martin plays the con man that goes to this guy and the guy is like a chemical engineer. Campbell Scott is the guy's name, the actor. And he has like a process for making a chemical and it's worth so much money. And the whole movie is Steve Martin conning him into telling him the chemical process. And eventually he took it.
All-In with Chamath, Jason, Sacks & Friedberg
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He was going to give him all this money, hire him. And then he disappeared once he got the knowledge. And that was the end of it. It's a great, great film. Shout out David Mamet. David Mamet, exactly. Yeah, fantastic. But I think there's a lot of
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
investment that goes into intellectual property businesses that include things like chemical engineering, obviously financial services, trading companies, algos in hedge funds, and a lot in software, that if you can access that intellectual property, without stealing it, but actually hiring an employee that has it in their head, you gain quite a lot.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
So I have had a lot of folks that I know in other industries outside of tech or software where California non-competes are not enforceable that aren't allowed to go work at a competitor for one year, two years, three years.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
Yeah, but the rate of change here is crazy. Like the rate at which software changes, I think is quite distinct from the rate at which, for example, a chemical engineering process might change. Where you learn that process, you spend $200 million building a system, and then that employee can go and tell it to someone else and suddenly changes everything about that other business. So I don't know.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
I feel like there's something about software that gives us this point of view that maybe it doesn't matter, but in other industries it might.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
I'll tell you a funny story. We had a meeting with the exec team from Apple when I was at Google. And Marissa Mayer and Sergey and myself and one other person went to the meeting.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
And Marissa's idea was, why don't we pitch Apple that we could put a cache of the internet in 200 megabytes, like the most important 200 megabytes of the internet, cache it and put it on the iPod so you could access the internet on the iPod.
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So basically search a cached version of the web. And that was the pitch. And they kind of were like radio silent. They didn't respond to the pitch. And then they kind of blank-faced stared at us. Two years later, the iPhone came out.
All-In with Chamath, Jason, Sacks & Friedberg
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Yeah, I met him at Macworld in 2003. He was walking the floor. It was at Moscone. I remember it because I've been a Mac user since 1984. First Mac original. I still have it in my office. Diehard, diehard Mac fan. I read every edition of Macworld, Mac user, Mac week. And so to meet him on the floor walking around, I was just like a 22-year-old kid. I was freaking out. It was awesome.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
Only time I met him.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
I don't agree that the Chinese government will shut it down. I certainly don't have any insight into what the Chinese government is discussing or thinking about doing. But there's a lot of money to be made here. So if I'm ByteDance, I'm very likely going to hire a bunch of bankers, run an auction process and sell this thing. And I have a year to do it.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
This is a business that did $14 billion in revenue last year, according to a published report. 170 million Americans are active users of TikTok. Our revenue grew 40% plus last year. So I don't know how they would just say, hey, let's write this thing off and shut it down when we could probably generate.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
But now let's assume that they let it go through. Think about the implications. Morgan Stanley and Goldman Sachs get hired to run a joint process to auction this thing off, right? They're going to run this process for a period of months. There's only a certain number of folks that could actually make a bid to buy this thing.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
Maybe some of the big guys in private equity, Silver Lake and others, try and pull some capital together to buy it. But I think it's more likely a big company tries to buy it. CFIUS and Antitrust will probably not be as relevant here as it normally would be. Certainly, CFIUS wouldn't be because it's being completely divested.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
Antitrust, there's a real question on whether they're going to be given some leeway. But even if antitrust does apply, who could buy TikTok in the US? There's only a handful of companies that could or would. Oracle, maybe Microsoft.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
That it's not a what?
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
Yeah. Absolutely. I do think that there's a really interesting... Maybe Netflix. So I think that there's a really interesting rewrite of the landscape a little bit here, where some of the traditional big tech companies, Meta, Google, have really had total control over the consumer media consumption on the internet, that there's going to be a real difference here that might...
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
be triggered in how the industry kind of is sorted based on the TikTok auction, if it does happen. And I think it's probably, look, we could argue all day about what the Chinese are going to do. But if it does go through, the next story you're going to see in the Wall Street Journal is how much money the bankers are going to make on fees running the auction here.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
And then the next story you'll see after that is going to be about how the tech and media landscape has been reshuffled and rewritten by the TikTok deal.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
There was a poll published yesterday, Bloomberg News Morning Consult surveyed 4,900 registered voters in seven swing states. And the poll showed that 77% of registered voters in those states support basically an asset tax on ultra high net worth people, people worth over $100 million to keep social security intact. So I think that's a strong indication of where things are headed generally.
All-In with Chamath, Jason, Sacks & Friedberg
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We can debate the tactics and the nuance of this election cycle. But as we all have talked about and know, Social Security becomes de facto bankrupt by 2033, perhaps earlier. So we have a few years to figure out whether we cut Social Security benefits in this country or find alternative ways to fund it.
All-In with Chamath, Jason, Sacks & Friedberg
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And it's pretty evident from this poll that Americans are not in support of raising the minimum age from 67 to 69, which was one of the questions in here. Only 25% of Americans support raising the minimum age for Social Security from 67 to 69. Meanwhile, 77% strongly support a tax on... ultra high net worth to fund the gap and the funding need.
All-In with Chamath, Jason, Sacks & Friedberg
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No, it doesn't. And I don't think that that's what really matters. I think most folks are voting for themselves, their particular needs, and the majority of people need more support.
All-In with Chamath, Jason, Sacks & Friedberg
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I think that's the inevitable trend. I'm just saying, I don't know how it's going to manifest. But I think it's inevitable that we're going to raise federal revenue through some form of taxation that's going to feel deeply uncomfortable and inappropriate. And it's going to have negative economic consequences. And this is where the economic spiraling happens. that Malay has talked about.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
I would say the analogy for Google is Android. where Google open sourced the Android operating system because the handset manufacturers and some of the big software companies, so Nokia and Microsoft in particular, BlackBerry, had these closed proprietary operating systems.
All-In with Chamath, Jason, Sacks & Friedberg
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And then the telcos put their apps on and made money and basically had control over whether or not people could access Google and Google services through their phone. So the intention with open sourcing Android was to make sure that Google was not disadvantaged in their core business over time.
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I think that there's a similar analogy here that by open sourcing these models, they limit competition because VCs are no longer going to plow half a billion dollars into a foundational model development company. So you limit the commercial interest and the commercial value. of foundational models.
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Now, the CapEx question is a really hard one to diagnose because we don't know how they're spending the money, where they're spending the money, what they're doing in there. I think that it's a really important sign that founder-led companies with these voting rights
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you know, have the ability to make these sorts of hard decisions that it might be very difficult for a management by committee group to make. Got it. Look at how Mark is making these decisions and Elon is making big, tough decisions that it would very likely be pushed back on if they didn't have the voting rights, if they didn't have the control over the company that they had.
All-In with Chamath, Jason, Sacks & Friedberg
Meta's scorched earth approach to AI, Tesla's future, TikTok bill, FTC bans noncompetes, wealth tax
There you go.
All-In with Chamath, Jason, Sacks & Friedberg
Scarlett Johansson vs OpenAI, Nvidia's trillion-dollar problem, the "vibecession," plastic in our balls
Yeah, I find it annoying to just listening to it.
All-In with Chamath, Jason, Sacks & Friedberg
Scarlett Johansson vs OpenAI, Nvidia's trillion-dollar problem, the "vibecession," plastic in our balls
The fair use case is interesting, for sure.
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I think the other... The interesting part of the other story is that the reason all the stuff came out about the equity clawbacks was because the safety team quit and it got leaked during that process. All right.
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That one, I think begs a little bit more of a question of...
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I don't know. I mean, it could be some bad bureaucracy, bad politicking, not being listened to. But I think the real interesting question is who's going to ask these guys what's really going on from a technology perspective and what is that going to reveal? Because these guys clearly are on the frontier of model development and the performance of models. And so my guess is...
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There are certain regulatory people who are going to have interest in the fact that this team just left. They're going to make a phone call. They're going to ask this team to come in and have a conversation. And they're going to start to ask a lot of questions about what the state of technology is over there. And I suspect that some things are going to start to come out.
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I think that the Cisco analogy, it's a pretty different situation because Cisco evolved the business to become much more enterprise centric. And they were able to run an M&A process like we see with enterprise software, where they could acquire and roll up lots of different product companies and sell into their enterprise channel. So do a lot of cross-selling.
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NVIDIA is not a super acquisitive business and it doesn't make as much sense because they're selling much more kind of infrastructure tools, whereas Cisco moved really high up in the enterprise stack. They were selling stuff into office buildings, they were selling software, they did acquisitions to kind of fully integrate.
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They had a very diverse set of products that were selling through an enterprise channel, further up the value stack, and a pretty distributed customer base, no serious concentration. Even though they did sell a lot into data centers, they were also selling to telcos, they were selling to enterprises, they were selling to governments, and so on.
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If you look at NVIDIA's revenue, they did $26 billion of total revenue in the quarter, $22 billion of which was data center, and about 40% of that was from the top four hyperscalers. So a full one-third of Nvidia's revenue in the quarter came from, I believe it's Google, Amazon, Microsoft, and Meta.
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And so between those four businesses, you know that those companies each have, I believe, at least over or close to $100 billion of cash sitting on their balance sheet. They can't find great places to invest that cash to grow revenue. And so they've rationalized away the idea that they will make CapEx investments to build over the next five to 10 years. And this is where that money flows.
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So I think that they're going to have less maneuvering capability than Cisco had in the future. And obviously, there's this deep concentration risk, which is going to be deeply challenging.
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They're under earning. They're under earning. And so the projection- So this is obvious.
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I think the whole thing comes down to the projection of an individual or a household of their lived experience onto the economy. You assume that because you're having a tough time, the economy is bad. And the economy as a definition for them is how do I earn and how do I spend?
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And if I'm under earning, that means there must be serious job loss and things are more expensive and my ability to purchase isn't improving. And so I think we're all kind of gonna end up on the same take on this one.
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I mean, Nick, if you wanna pull this image up, this is I think a helpful one, which is disposable personal income relative to outlays that folks are needing to spend more than they're making. So clearly indicating that they're feeling like they're under earning. So the projection of that is the economy is bad without recognizing that it is an inflationary experience.
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Whereas economists use the definition of quote economic growth being gross production, gross product. And so if gross product or gross revenue is going up, they're like, oh, the economy is healthy. We're growing. But the truth is we're funding that growth with leverage. at the national level, the federal level, and at the household and domestic level.
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We are borrowing money to inflate the revenue numbers. And so the GDP goes up, but the debt is going up higher. And so the ability for folks to support themselves and buy things that they want to buy and continue to improve their condition in life has declined, things are getting worse.
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And if you go to the next image, as Sax pointed out already, here's the image of total outstanding credit card debt over a trillion dollars, it's totally spiked. And it's gonna continue to spike just like federal debt because of the next chart, which is the sudden jump in interest rates. So we've seen credit card interest rates jump from 12% on average 10 years ago to 21.19% right now.
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And it was at 14% at the end of 2022. So we've gone from 14% average credit card interest rates to 22% now in just about 20 to 24 months. And so the projection that I think of the quote, economy must be bad is resulted from the fact that income to spending is actually pretty negative. So here's the real median family income. This actually only goes through 2019.
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So it doesn't even capture the era that we're talking about, but this has been going on for quite some time that the average American's ability to improve their condition has largely been driven by their ability to borrow, not by their earnings.
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And this has created a substantial set of precedents that we're now running into a wall with interest rates spiking and inflation hitting us because of the overall federal debt that we've taken on.
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This is incredible.
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Yeah, but remember what McDonald's and other fast food companies have said is that labor costs have climbed. Here's a chart on labor costs that Nick can pull up. Workers at Walmart and McDonald's have had pay increases, but this has really been to try and keep up with inflation, the inflation of other costs. So a lot of people will say, oh, they're price gouging.
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They're ripping off consumers to make profits for shareholders. But the truth is the biggest component of running those restaurants is labor. And labor has gotten more expensive because the employees that work there have to earn enough to pay their bills and to afford their food. And this is the circular effect of inflation. It finds its way all through the economy.
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It filters down and it eventually hits everyone.
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I go every week. I cannot believe how expensive things... I mean, some of the stuff, I was just blown away how expensive things... It's bonkers.
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I think we should all go to Tokyo for a weekend and do some fruit tasting in Tokyo.
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A Democrat may- And all rationalized.
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Yeah, the Consumer Reports put out a really interesting or what has become pretty widely covered now story a couple of weeks ago where they measure phthalates in common foods. And Nick, if you want to just pull up the image, that's been repeated in a lot of media, a lot of press. People were going nuts over this.
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Phthalates are these chemical compounds that are used in plastics or used with plastics to soften them. So when you make plastics, you can kind of, you know, make them softer and form them into all sorts of different shapes and use them for different applications like plastic bags or wraps or cubes or all sorts of things.
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And phthalates are these kind of smaller molecules that kind of go along with the polymers that are the basis of the plastics. And they measure phthalates, which are known to be toxic in terms of if you get enough of them, they can be carcinogenic and cause cancer. And they showed that every product they tested had phthalates in it.
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Wendy's chicken nuggets had, you know, 33,000 nanograms per serving.
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Right. And just to be clear, guys, this is not just about packaging. Packaging plays a role, but the whole food supply chain, the way we wrap food, all of our water, all of our dust, all of the air we breathe, we have measured phthalates in everything. So these phthalates end up in the animals that are used to make milk and the animals that people eat.
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They end up in the water that goes into the vegetables that we grow in the ground. They end up being used to make the little plastic jars that we feed our kids out of, the little yogurt pouches that our kids drink out of, everything, just to move food around in plastic packaging.
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They are eating things that have plastics in them. Plastics in them. But we also don't know.
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We're eating the plastic. And it's also the fact that the way that they process the chicken and the material that they use and the packaging that they use and how they move this stuff from one place to another. You got bags that are holding chicken breasts that then get put in the thing. And then the oil is transported in plastic. So it's plastic all the way down. Guys, look at this.
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No, this is a really good point. Hold on, Chamath's making a really good point. Go ahead, Chamath. This is really good.
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Yeah. It is. And let me just tell you guys some stats about this. So we produce about 3 million tons of phthalates a year, creating them that we use in our industrial supply chain. The global market for phthalates is about $10 billion per year. We find it everywhere. In our tap water, as measured in the US in multiple places, there's about one microgram. So those were nanograms.
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So you kind of divide it by 1000. So that Annie's thing has 50 micrograms of phthalates in it, but there's about one microgram of phthalates per liter of water that you're drinking. Now, here's a study was done out of Germany, where they basically tried to estimate how much people were consuming.
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And on average, people consume or ingest about six micrograms of phthalates per kilogram of your body weight per day. So an adult male is consuming about 500 micrograms of phthalates per day. That's half a gram. per day, and the human body metabolizes and excretes it, it comes out. The EPA, all of the administrative agencies that oversee this stuff, they're like, it's okay, we metabolize it.
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As long as we don't consume more than we can metabolize, it's gonna be safe, because it's not gonna stay in our bodies, it's gonna wash out. Here's the problem. While it's in your body, while it's moving through your body, being metabolized, it is what's called an endocrine disruptor. And we talked about this in the past with respect to the sunscreens.
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These phthalates actually interfere with the hormones that are made by things like your pituitary gland, your thyroid, and even some of the hormones that are produced in testicle cells. There was another study done that really tried to estimate what the impact was. And here is a study that showed how do phthalates actually interact with different parts of the endocrine system.
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And they went through and they found all these places that biological hormones and the endocrine system are disrupted by the phthalates. And we'll put credit for everyone that shared these papers here later. And they basically showed the mechanism by which the phthalates are actually disrupting endocrine systems. Now, what is the endocrine system? We talked about endocrine disruptors in the past.
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The endocrine system is the interaction of hormones with cells in your body produced by all these different glands in your body, like your thyroid, your pituitary gland, and so on, controls things like growth, tissue development, reproductive tissue activity, like making sperm cells
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autonomic function like body temperature, blood pressure, sleep, heart rate regulation, injury and stress response, your mood, all of those things are regulated by your endocrine system. And so when the hormones or the proteins or peptides that are made by those glands are disrupted by these phthalates, it can actually disrupt those systems and mess them up.
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So while we're not consuming, generally speaking, enough phthalates to cause cancer, and therefore we all say, hey, it's okay, these phthalates aren't that bad, we're not gonna all die from cancer. The truth is there is demonstrations now on how they can actually disrupt the activity of your endocrine system, and as a result, have all of these deleterious effects.
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Another study done on 125 men out of China, this paper was done out of China, They saw damage to testicle cells that would die, testicle cells that would produce fewer sperm, and then testicle cells that produced sperm with extra nuclei. And they actually demonstrated this in rats. So the set of compounds can be fairly... disruptive. So now we'll go to the next story, right?
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And the next story is the one that everyone's writing about, which is, oh my God, there's plastic in balls. So a team at University of New Mexico that was published in the Journal of Toxicological Sciences just last week, they took 47 neutered dogs' testicles from a local pet clinic where they were getting neutered.
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And they found, on average, 128 micrograms per gram of microplastics in those testicles. And it was mostly polyvinyl chloride or one of the main plastics and polyethylene. And again, phthalates leach out of these plastics and leach into the cells.
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And then they went to the medical investigator's office and they found the testicles that were frozen for seven years because when they do a medical investigation and they keep all the body parts, they keep them on ice and then they throw them away after seven years. So before they threw them away, they got permission of humans. They got permission to use these testicles to figure out
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Or they're plastics, and they measure them.
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No, it's like when there's a homicide, or you don't know who died, or there's an investigation into why someone died, the coroner keeps the body parts in case it's needed for a police case later.
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Okay. You don't have these frozen balls on your driver's license to freeze my balls?
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Anyway, they got 23 of these balls from these bodies, and they found plastics, on average, 328 micrograms per gram of testicle in these balls.
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Well, we don't know, because we've never taken human tissue and tried to take it apart in a very detailed way to figure out how much plastic is there, what is it doing to our body? But now I just want to connect the dots. So now we have a sense that there's these phthalates and these other compounds that come with plastics that leak in that cause all this disruption.
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Separately, we're seeing this accumulation of these little plastic particles. And remember, plastics are polymers. They're long chains of monomers. And so they can be short chains. They can be long. So they break apart, break apart, break apart. And little tiny bits of them end up and they're very hard to metabolize. And they sit in your tissue. And then they can cause all this disruption.
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So, you know, I think these are like... I'm just going to say it.
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But you can't get away from it. It is everywhere.
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It's in the water. It's in the air. It's everywhere.
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I want to just push back on this because I don't want to limit it.
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I don't want to limit it to the food supply because here's the other thing. All of us are wearing clothes that use polymers, which are plastics. All of us are sitting at desks that have coatings of polymers on them. All of us have iPhones that use polymers. All of us
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drive cars, and the rubber, one of the ways that they found that plastic, these microparticles are getting in the air, is through tires. When we drive, little particulates end up in the atmosphere, we breathe them in, and then they end up in our body. Every part of our industrial supply chain uses polymers.
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Yeah, but let's say you're wearing clothing. Almost all of our clothes now, many of our clothes have polymers in them. We put it in the washing machine. It ends up in the water supply chain. We consume that water. It's very hard to say that there's a specific action. Our whole system has been inundated with these lower costs.
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Yeah, where do you start? My big takeaway is sort of like yours, which is almost impossible to alter this industry overnight, given how ubiquitous these compounds are in everything we do and touch, tires, phones, clothing, etc., But I think that this is going to trigger and is the beginning of a wave.
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I'm noticing that a lot of folks are going to start to pay attention in the food industry and start to figure out ways to represent low plastic, low phthalate food products as a way to kind of sell a more premium solution. I think that's been the trend historically with the food industry, Chamath, is to respond to your ask right now and to then show up with solutions.
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So I do think that that's... And just taking a step back. We don't have to use these. These are all based on fossil fuels. So the way we make plastics is we basically pull oil out of the ground and we turn it into these polymers. That's the basis of this chemical industry. We don't have to do that. With the same function, we can get the same function from what are called bioplastics.
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So these are compounds that can actually be much more biodegradable that are made with biological systems and not made from oil using synthetic chemicals systems. So I do think that there's a really...
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big opportunity for a wave of bioplastic alternatives, given that this is now becoming a little bit more obvious to folks that there is this kind of systemic problem, that this is ubiquitous, and that we do need to kind of address it.
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Let me play in. What are the bofas, Jason? Bova deez nuts.
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Is that your actual office behind you? Or is that a background, Jamal? That's my office. Yeah, yeah. So like every one of those books is coded in some of these compounds.
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Okay, good. All right. Well, everything else at the desk is made of all of those items. Yeah. Yeah.
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And you're, you're, you're pure. I'm assuming you're, you're, you're wearing a pure baby wool sweater, which doesn't have any polymer.
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But I think what's, what, what's, what's overwhelming about this problem, right?
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It is. What's overwhelming about this problem is the ubiquity of the problem. It's almost like asking, tell me everywhere that carbon is used. Like, imagine if you had to label every M&M you're eating. No, I know.
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I think we got to go into the source. So biopolymers are made by living organisms. They're typically longer chains of what are more like sugar molecules. And they can be used in a similar way that we're, they're not going to be as good as synthetic polymers that we use today.
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So a lot of our applications, a lot of our industry would have to be rebuilt if we really wanted to go back to redesign the whole system. But we got to redesign the whole system, Chamath. We're making everything out of these products because they're cheap. And because we can pull oil out of the ground and turn it into cheap stuff. And then it makes things affordable for everyone on earth.
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And that's how this industry emerged. You know, it was not like someone randomly came along and said, let's put plastics in everything because it's going to be good for people. It was a way to make products more accessible and more available and cheaper. And it's everywhere. And so I think there's this real question of like,
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what industrial synthetic chemistries do we use today as a species that we should rethink using and start at that level and then rebuild from there? And I think shining a light on this stuff and just talking about what these products are and how to find a way to start a system is really important.
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I think what we will see over time is that rather than have the ability to sue for their likeness, a lot of AI that is like a celebrity the value of it will arise from the celebrity's endorsement, not actually using the celebrity's features.
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Oh, okay. But. I thought you were like sitting at the store photographing banana.
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Yeah, but then how many people in your house handle your banana? Pause! Whoa, whoa.
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Make sense of it all. Yeah.
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I think everyone feels helpless and everyone wants to grasp on to something that they can do.
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Right, totally.
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So without the endorsement, I know everyone kind of wants to point to this idea of likeness, but I think that there's something about the authentic aspect of having the celebrity actually endorse and provide their endorsement their signature, their stamp on it. Restaurants are a good example. Some celebrity chef says, I was involved in making this menu.
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That's a lot different than mimicking the celebrity chef's menu from his restaurant, putting his or her name and brand on it. There's a bunch of videos on YouTube now. I don't know if you guys ever, you guys probably don't watch these, but I love watching these videos where like music producers make tracks and how they do it.
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Bye-bye. Bye-bye.
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And so many of these producers now are using AI tools, taking samples off of old records or other tracks, and then telling the AI, make something that sounds like this or looks like this, but isn't like this. And so there's enough of a transformation happening that it isn't a direct likeness.
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And then they're able to create entire vocal tracks without needing a singer or without needing the celebrity singer.
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Yeah, I'm in I'm in the like, like the content itself, I think is probably less like compelling. Oh, you go go after her because the voice sounds the same. But I do think that there's this element of like, what if you could then say, hey, you know, Britney Spears actually lent her voice to this track.
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No, I think there's probably going to be a lot of discovery to Sax's point that's going to show that they probably did. Yeah, the discovery is going to be juicy.
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In both of those cases, you guys have your exact image of you being shown to sell stuff. I think that in this case, it's also unique to ScarJo because she was the voice from her. If this were a voice sort of like Cameron Diaz or sort of like Julia Roberts, it wouldn't be as big a deal because it certainly got some differences to it. But it's because they're trying to mimic the movie Her.
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What do you guys think about the fact that they're not trying to say this is this person's voice, but they want to say like, hey, let's say you just can prompt the AI and say generate a voice that is sort of like movies that are comfortable and calming to people to listen to. And, you know, that we think people will be comfortable. And the AI generates something that sounds like ScarJo.
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but it's not deliberately trained on ScarJo.
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Is the public confused is the only test you need for you. What if there's two public actresses that both have similar voices and then they both claim, hey, you tried to make this sound like me. What do you do in that case, Jamal?
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Yeah, exactly. And did the CEO tweet her? I think your whole point about discovery is what is going to get them in trouble in this case. Because they were clearly trying to do an impersonation of her, right?
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Yes.
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Hmm.
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has gone crazy with it. Love you, Wes.
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We need to get merch.
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Let your winners ride.
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Tamak, did you go down to the breakthrough thing this weekend?
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You could look at this as being a culture of entitlement that let folks feel that our employees that they have permission to stage sit ins and behaviors like this because Google is so infinitely tolerant and giving employees the space and the room to do whatever they want to do and all of their wishes and demands can be met and will be met if they demand it strongly enough.
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That's one way to look at this, and that culture manifested this behavior.
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Another way to look at it is that these people feel so deeply, strongly, and passionately about the issue at hand that they were willing to risk their jobs and arrest, and they cared so deeply about an issue that they think no one's paying enough attention to that they're willing to put themselves and sacrifice themselves for it.
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So I want to be empathetic to that point of view as well, but I do think that there's a belief that there may have been this kind of entitlement culture where anytime Google employees ask for stuff, they get it. Someone told me the other day how at TGIFs at Google now where they do these all hands and people get to ask questions, this person is kind of executive level.
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They're so sick and tired of how every question is all about employees asking for more things that they want. So it's like, when are we going to get this bonus? When are we going to get this gym? When are we going to get this? That's so much of the orientation of being an employee at Google. It's all about what Google can do for me and how I can get more. And that becomes what you ask for.
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It's like you give a kid something, you give them candy, they always ask for candy. And I think that there is certainly an element of that culture kind of being... frothed up over the years at Google. But I do think that this is an issue that people care very passionately about right now, and you're seeing it all over the place.
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Dad, I said get me the spicy fries, not the regular Cajun fries. The girl that won it, Freebird, did something with Yamanaka Factors.
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I think there's a lot of issues. One is just the challenge of deep tech More specifically, in this case, hardware investing, you have to invest a lot of capital before you even have your first product. And then you don't really know how well it works until you've already burned through a lot of capital.
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I mean, this is one of the stunning stories of a startup that has raised a quarter billion dollars. And then they come out with their first product. And it turns out it needs a lot of work because it doesn't do anything that consumers really are compelled by, as evidenced by the review.
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So I think it highlights that that challenge and why that market finds, particularly in this environment, it to be so hard to get capitalized. Now, obviously, there are some entrepreneurs like Elon, who can take that capital and drive to the outcome, spending hundreds of millions of dollars before you get your first rocket into space. And you have a lot of failings along the way.
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But the general tone here is a deep tech investment is very likely to fail because you spend so much money before you even know. And at that point you have less money and you can't really make the necessary iteration to get there. So it's a tough data point for other deep tech companies that need to raise a lot of capital. Then I think it brings up the point about X Apple people.
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that there's a degree of confidence because people come from Apple, and a degree of hubris in the employees that come from Apple, that says, I have worked at the best hardware company in the world, therefore, this person is likely to succeed.
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It turns out that when you don't have all that built in infrastructure for testing, and optimization, all of that built in distribution, all of the feedback systems that Apple has engineered into their business model for so long, maybe you missed some of the data around what makes a product great or not before you launch.
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And they get to... Well, I think then there's also this question about like, where is the value in the product? Because they thought, hey, if we have AI on a pin, it'll work. without the consumer feedback about whether or not people are willing to sit around and wait for 12 seconds to get an answer to a question.
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And then it brings up this other really important point, which is half the people in Silicon Valley are running breathlessly into the conversation saying, do not disparage a startup that's working really hard at getting their first product right. It'll destroy the motivation of other startups that need to kind of iterate to get there. And we can't just take the first V1 and say that that's it.
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Chamath, your thoughts?
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The other half of Silicon Valley are running in and saying, this thing's a piece of shit. What are you talking about? It doesn't work. So it is a really interesting kind of debate. Yeah, Rorschach test on what's going on.
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An irreverent elitist will eat octopus. Here we are.
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Yeah, the primary function is like a chat AI assistant that sits on you and has a camera. And so you can say things.
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But sorry, let me just give the quick overview. And basically you ask it questions and it can go get the answers. The problem is that it has to go make a request to the internet, run an AI model and come back. So it takes like 12 seconds to get results. Most of the time, according to the reviewer, the results are actually wrong. Because it's hallucinating models.
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The voice-to-text translation is wrong. There's a lot of things that are wrong about it. So it takes a long time. It's clunky. And then the battery burns out every two hours. And it gets super hot because of the way they get it to magnetically stick to your clothes. So it gets very hot. So there's all sorts of issues.
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That was the other thing he said is like when you're in a crowd and there's a voice around, you can use your hand and hand gestures to control it and do things with the projectors thing that it does.
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This became law in the 2017 Jobs Act, as you highlighted. And basically, it means that companies not just like tech companies, but life sciences companies, defense companies, are pushing Congress to change this law, because you can't actually deduct the expenses that you use to run your business You have to only deduct them over five years, 20% a year.
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So like you pointed out, if you're making a million dollars, but you're spending a million dollars, you made no profit, but you got to pay taxes as if you made 800 grand in profit. And a lot of these small companies don't have that cash. So venture capital backed companies and public companies that are profitable, they can afford to do this because they have large balance sheets.
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So it doesn't affect them as much as it does the literally hundreds of thousands of small businesses that work in the life sciences sector, the defense sector, the tech sector, that are struggling this year to make the tax payments that are required under this law that went into effect last year.
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And Congress promised that they were going to repeal this law leading up to April 15th, which happened obviously a few days ago, and make it retroactive to 2023, but they didn't.
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So the original intent was that this was one of the ways you guys know, whenever you pass a bill, it gets run through the OMB and the CBO that figures out what's the budgetary cost of the bill.
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And one of the ways that they made this work, this bill, the 2017 Trump Tax and Jobs Act, you guys may remember in that bill, they also made it impossible to deduct entertainment and dining expenses when you take people out to dinner anymore. That sucks. And they did all those things to make up some of the money they were using for basic general tax breaks for companies.
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So they use this as a way to say like, look, in a couple of years, we're going to kick in this R&D expenditure thing, and it'll trigger a lot more revenue for the federal government. It'll create a lot more taxes and a lot more revenue. So that was the idea. And everyone was like, yeah, okay, sure, we'll do that. Great. It makes the accounting work.
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And then in a couple of years, you know, nudge, nudge, wink, wink, we're going to come back and repeal it. Except Congress has stalled out. There's this ineptitude where anytime someone tries to pass a bill in Congress, someone else says, I want to get money. And so the Democrats showed up and said, we want this child tax credit thing to show up, which basically was passed during COVID.
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Not only is it deeply wrong to eat all the animals that you people eat and you will one day realize it or your children or your children's children will realize it. But octopus in particular have the IQ of four to eight year olds. They can actually sign, they can communicate, they can solve problems. You can watch YouTube videos on this. It's pretty incredible. They're amazing creatures.
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And they want to extend it going forward. And the child tax credit says that you can get a check for $1,800 a year in 2023, $1,900 in 2024, and $2,000 in 2025 for each child you have. And the Republicans in the Senate are saying, wait a second, for people to get this thing, we wanna make sure they're working. We wanna make sure it's not as retroactive.
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So now there's this big debate about how big the child tax credit should be. And that's keeping this R&D thing from going through. And meanwhile, I've gotten tons of emails from CEOs of tech companies that are breaking even. These are not tech companies that are making a ton of profit. They're not public. They're not venture backed. They're just people running their business.
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And now they're going to have this huge tax bill, even though they didn't make any money this year. And it's crippling businesses around the country. And what do they do? They're going to write a check. They're going to borrow money.
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They're going to go to the bank, borrow money, or they're going to incur penalties with the IRS because they don't have the cash to pay the tax bill because they don't have any profit. They didn't make any money.
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If they just ran the business break-even, which a lot of these companies do, is just make a little bit of money or break-even, and then they've got this huge tax bill and profits they didn't actually have, they've got to go figure out how to write a check.
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Yeah. There's all this writing in the, um, if you get audited by the IRS, they have the ability to basically capture everything. So like, let's say you're a mobile app developer and you make a million dollars a year, but you spend a million dollars a year on your developers.
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They're going to count that. They have the ability to count that as an R&D. So the accountants, the tax accountants tell you, book it all as R&D because otherwise you could get audited and actually get in trouble. Because anything that involves the development of technology now is considered R&D. Again, a company working in life sciences is a research company doing lab work.
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My understanding is most of this stuff is getting captured and that's why it's hurting everything from defense to life sciences, to lab equipment, to startups that make software, to everything. And Congress can't get out of its own way where this bill passed, by the way, bipartisan in the House.
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Then it went to the Senate, and now it's getting taken apart in the Senate, and now it's stalled out, and everyone's freaking out that it stalled out past April 15th. And it's actually going to hurt a lot of small businesses in this country. And here's the other problem. is it actually limits our ability to invest in innovation in this country, because now you're better off.
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There's no other country in the world that does this. Every other country in the world tries to incentivize investment in innovation. And here in the US, we're basically saying, no, we're going to tax you for investing in technology development and innovation.
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And the other thing that's actually not being talked about is even in this bill where they're repealing this, they're leaving in the fact that if you invest in R&D outside the US, you have to amortize it over 15 years. So let's say that you're a US developer and you hire people offshore. Yeah.
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You've got to basically amortize the offshore stuff over 15 years, which means you'll never make a profit. You're always going to have to pay taxes.
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It's also why in the movie, The Arrival, the future alien race is made out to be cephalopods because they're the most advanced creature that's likely to become a civilized form if humans didn't exist. I have a one word reaction to that. Yum.
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It means that- Well, it's also an illustration of just how hungry we are for tax revenue in this country. It's only gonna grow, and I'm not sitting here complaining about taxes. The Trump tax cut that he put in place in 2017 added $1.5 trillion to the federal deficit,
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So tax cuts in general are not great when you're spending a lot, but it does highlight just how much we are spending at the federal level and the demand for tax revenue. And that demand causes this counter cyclical problem, which is now we're gonna eat into innovation, which is supposed to drive, get us out of the problem, the spiral that results from this debt.
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So it really highlights like just the challenges that are going to emerge, particularly in a decade ahead, because we have all of the spending that's coming in front of us over the next decade, and how we're going to start to demand more and more tax and all these weird ways that can really hurt industry.
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That's right. But if the business is growing, you're always going to be in a hole.
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Right. So if your revenue is growing and your OpEx is growing, you're always going to be in a hole.
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I mean, that's what I would do. Remember businesses, and you guys know this, like when you look at a public company's financials, what you're seeing is their gap financials, generally accepted accounting principles. And that's the way that you present the financials of a business. That's different than the way you present financials to the IRS.
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You don't have a lot of discretion in your tax financials. Your tax financials are actually quite different than your gap financials. Yes. So when you file your taxes, there's a lot of rules on what you are allowed to deduct and aren't allowed to deduct that's quite different than how you present your corporate financials to investors.
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And that's really where people get screwed is you don't have that sort of discretion that you do in kind of sharing your financials with investors. So...
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I just hope Congress resolves this because it's, you know. Yes, super important.
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Are you off the Wagovi or the, what do you call it?
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How do you get better at chess? Freebird, do you have a rating?
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Yeah, be vulnerable, dude.
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What is it? Ask me other questions. Just don't ask me about my chest rating. Are you ashamed of your rating? Don't ask me about my chest rating. Ask me anything else. What is the lowest rating?
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The chest.com app has very good lessons on it too. It's actually quite good.
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My puzzle rush scores are pretty good.
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No, no, you play, it's like how many you can get in a certain period of time. How many, and it gets, it gets sequentially harder as you complete the puzzles and you have like a limited period to do it. So yet you feel shame.
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I used to go to the Recycler newspaper. Do you guys remember that? Yeah. And I would buy used electronics equipment, computer equipment, and then I would sell it. So I would then post other ads. I basically did ad arbitrage as a way to think about it. So I would go and find people selling stuff that I thought was underpriced. But did you fix it?
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there was nothing to fix you would just it was underpriced and then i knew like the better market to go sell it and make more money so then i'd buy like all these like old like like a broken receiver this disc man and a receiver good speak speakers that i knew were good but they were like deeply discounted i drive around in my white van i'd pay people cash i'd load it up and then i go sell it to like other people by putting ads and no wonder you wound up at google
All-In with Chamath, Jason, Sacks & Friedberg
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And it said, we open sourced it to the fans and they've just gone crazy with it. Love you, Wes. Queen of Kicks.
All-In with Chamath, Jason, Sacks & Friedberg
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Yeah, you're just collecting your coupon. But yeah, we had within 72 hours, I think we had more applications than we have seats, but we're still leaving applications open. And in the next week, we'll start to respond to people. So basically, if you're interested in going to the summit, Sign up now. Get your applications in this week. Apply early is the key.
All-In with Chamath, Jason, Sacks & Friedberg
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Yeah, because it's going to be done in order of when it's received. And they're going to start processing applications this week. We'd love to get everyone that wants to show up, show up. And if you went in the past, your registration window is wrapped up this week. So...
All-In with Chamath, Jason, Sacks & Friedberg
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So no plan yet, but there will be, yeah, we'll still do scholarships because I think they were super successful and helpful to people that otherwise couldn't afford the ticket. I know it's expensive this year, but the reason was we actually spent a lot more per person last year than people actually paying for their tickets.
All-In with Chamath, Jason, Sacks & Friedberg
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Yeah, we're trying to get the price so that we can make the same break even. And we're going to have scholarship tickets with the balance. So it should be awesome.
All-In with Chamath, Jason, Sacks & Friedberg
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Not talking about it yet. Not talking about it yet.
All-In with Chamath, Jason, Sacks & Friedberg
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Not yet. Not yet. We'll do a big announcement.
All-In with Chamath, Jason, Sacks & Friedberg
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Well, a friend of mine who you hung out with down there called me last night to give me the breakdown on all the individuals he saw and what was going on with them.
All-In with Chamath, Jason, Sacks & Friedberg
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I mean, yeah, there's obviously a line crossed in the view of security, but I think You could look at this two ways.
All-In with Chamath, Jason, Sacks & Friedberg
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I think it's become quite apparent that there's an evolution underway in model architecture. And I think you may remember, we talked about this briefly with Sam last week, but we're moving away from these very big, bulky models that are released every couple of months or quarters and cost a lot of money to rebuild every time they get re-released towards a system of models.
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So this multimodal system basically leverages several models at once that work together or that are linked together to respond to the inputs and to provide some generative output. And that those individual models themselves can be continuously tuned and or continuously updated. So rather than have, you know, hey, there's this big new release that just happened.
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This new model just got trained, cost $10 million to train it. It's been pushed. These models can be upgraded with tuning, with upgrade features, and then linked together with other new smaller models that are perhaps specialized for specific tasks like doing mathematics or rendering an image or rendering a movie.
All-In with Chamath, Jason, Sacks & Friedberg
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And so I think what we're going to see is soon more of an obfuscation of the individual models and more of this general service type approach where the updates are happening in a more continuous fashion. I think this is the first step of OpenAI taking that architectural approach with GPT-4.0. And what's behind the curtains, we don't know. We don't know how many models are there.
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We don't know how frequently they're being changed, whether they're being changed through actually upgrading the parameters or whether they're being fine tuned. And so this seems to be pretty obvious. If you look at this link, one of the criticisms that initially came out when they released GPT-4.0 was that there was some performance degradation.
All-In with Chamath, Jason, Sacks & Friedberg
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And Stanford actually runs this massive multitask language understanding assessment. And they publish it, I think, daily or pretty frequently on how all the models perform. And you can see the scorecard here that GPT-4.0 actually outperforms GPT-4.
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And so this goes counter to some of the narrative that in order to get some of the performance improvements and speed improvements they got in 4.0, that they actually made the model worse. And it seems actually the opposite is true, that the model's gotten slightly better. It still underperforms Cloud3.
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Opus, which you can see here ranks top of these charts, but there's lots of different charts, all the companies published on charts, they all claim that they're better than everyone else. But I like Stanford because it's independent.
All-In with Chamath, Jason, Sacks & Friedberg
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We missed you last weekend. We missed you last weekend.
All-In with Chamath, Jason, Sacks & Friedberg
GPT-4o launches, Glue demo, Ohalo breakthrough, Druck's Argentina bet, did Google kill Perplexity?
We missed you on Saturday night. Saturday night was really fun.
All-In with Chamath, Jason, Sacks & Friedberg
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We had a cabana set up on Saturday, played blackjack by the pool. I missed you guys too. I had a FOMO when I saw the videos. It was so fun.
All-In with Chamath, Jason, Sacks & Friedberg
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That's AI-generated.
All-In with Chamath, Jason, Sacks & Friedberg
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I also got to enjoy for my first time ever the experience of Baccarat, which I've decided is the most degen game on earth. It's literally the most, you just flip a coin. More than craps.
All-In with Chamath, Jason, Sacks & Friedberg
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Well, craps is really, there's a style. Craps, you make betting decisions. All you do in Baccarat is you say bank or player, and then you freak yourself out about how you flip the cards. And the smartest people I know on earth are all sitting around this table at two or three in the morning saying, turn this corner this way. No, no, no, no, no. Turn it this way. Turn it this way. There's two dots.
All-In with Chamath, Jason, Sacks & Friedberg
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I did promise you that when Ohalo decides to come out of stealth and explains what we've done and what we're doing, I would do it here on the all-in pod first before the- And all-in exclusive. All-in exclusive. So basically, by the time this pod airs, we're going to be announcing-
All-In with Chamath, Jason, Sacks & Friedberg
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what Ohalo has been developing for the past five years and has had an incredible breakthrough in, which is basically a new technology in agriculture. And we call it boosted breeding. I'm gonna take a couple of minutes just to talk through what we discovered or invented at Ohalo and why it's important and the kind of significant implications for it.
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But basically five years ago, we had this theory that we could change how plants reproduce. And in doing so, we would be able to allow plants to pass 100% of their genes to their offspring rather than just half their genes to their offspring.
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And if we could do that, then all the genes from the mother and all the genes from the father would combine in the offspring rather than just half the genes from the mother and half the genes from the father. And this would radically transform crop yield and improve the health and the size of the plants.
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I'm trying AI backgrounds. I'm going to try it out for a while with different crops.
All-In with Chamath, Jason, Sacks & Friedberg
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which could have a huge impact on agriculture because yield, the size of the plants ultimately drives productivity per acre, revenue for farmers, cost of food, calorie production, sustainability, et cetera. So this image just shows generally how reproduction works. You've got two parents.
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And they're debating the right way to flip a card over. That's true.
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you get a random selection of half of the DNA from the mother and a random selection of half the DNA from the father. So you never know which half you're gonna get from the mother or which half you're gonna get from the father. That's why when people have kids, every kid looks different. And then those two halves come together and they form the offspring.
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So every time a new child is born, every time a plant has offspring, you end up with different genetics. And this is the problem with plant breeding. Let's say that you have a bunch of genes in one plant that are disease resistant, a bunch of genes in the other plant that are drought resistant, and you wanna try and get them together.
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Today, the way we do that in agriculture is we spend decades trying to do plant breeding, where we try and run all these different crosses, find the ones that have the good genes, find the other ones that have the good genes and try and keep combining them. And it can take forever and it may never happen that you can get all the good genes together in one plant to make it both disease resistant
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and drought resistant. So what we did is we came up with this theory that we could actually change the genetics of the parent plants. We would apply some proteins to the plants and those proteins would switch off the reproductive circuits that caused the plants to split its genes. And as a result, the parent plants give 100% of their DNA to their offspring.
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So the offspring have double the DNA of either parent. You get all the genes from the mother, all the genes from the father. And finally, after years of toiling away and trying to get this thing to work, and all these experiments and all these approaches, we finally got it to work. And we started collecting data on it. And the data is ridiculous.
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Like the yield on some of these plants goes up by 50 to 100% or more. Just to give you a sense, like in the corn seed industry, Breeders that are breeding corn are spending $3 billion a year on breeding, and they're getting maybe 1.5% yield gain per year. With our system, we are seeing 50% to 100% jump in the size of these plants. It's pretty incredible. Here's an example.
All-In with Chamath, Jason, Sacks & Friedberg
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This is a little weed that you do experiments with in agriculture. called Arabidopsis. So it's really easy to work with. And you can see that what we have on the top are those two parents, A and B. And then we applied our boosted technology to them and combined them.
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And we ended up with that offspring called boosted A and B. So you can see that that plant on the right, it's much bigger, it's got bigger leaves, it's healthier looking, et cetera.
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Yeah, it's called polyploidy. So we actually see this happen from time to time in nature. For example, humans have two sets of chromosomes, right? So does corn, so do many other species. Somewhere along the evolutionary history, wheat... doubled and then doubled again. And you end up actually in wheat having six sets of chromosomes. Wheat is what's called a hexaploid. Potatoes are a tetraploid.
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They have four sets of chromosomes. And strawberries are an octaploid. They have eight. And some plants have as many as 24 sets of chromosomes. So certain plant species have this really weird thing that might happen from time to time in evolution where they double their DNA naturally. And so what we've effectively done is just kind of
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apply to protein to make it happen and bring the correct two plants together when we make it happen.
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It wouldn't work in animals. It works in plants. Okay. And one way you can think about plant genetics is all the genes are sort of like tools in a toolbox. The more tools you give the plant, the more it has available to it to survive in any given second, to deal with drought or hot weather or cold weather, etc.,
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And so every given second, the more tools or the more genes the plant has that are beneficial, the more likely it is to keep growing and keep growing. And that plays out over the lifetime of the plant with bigger leaves and bigger, you know, grows taller. But more importantly, if you look at the bottom, the seeds get bigger. And in most crops, what we're harvesting is the seed.
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That's true in, you know, corn and many other crops. And so seeing over a 40% increase in seed in this little weed was a really big deal. But then we did it in potato. And potato is a crazy result. Potato is the third largest source of calories on earth. And so we took two potatoes that you see here in the middle, AB and CD.
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We applied our boosted technology to it, to each of them and put them together. And you end up with this potato ABCD, that's the boosted potato. And as you can see, these were all planted on the same date and the boosted potatoes much bigger than all the other potatoes here, including a market variety that we show on the far right. That's what's typically grown in the field.
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We're two across. So great. And then you get to decide whether the bank turns over their cards and when they turn them over.
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Now here's what's most important. When you look under the ground and you harvest the potatoes, You can see that that AB potato only had 33 grams, CD had nine grams. So each parent had 33 and nine grams potato, but the boosted offspring had 682 grams of potato. The yield gain was insane. And so you could see this being obviously hugely beneficial for humanity.
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Potatoes being the third largest source of calories, Indian potato farmers are growing one acre of potato. In India, they eat potato two meals a day. In Africa, potato is a food staple. So around the world, we've had a really tough time breeding potatoes and improving the yield. With our system, we've seen incredible yield gains in potato almost overnight.
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Those are normal-sized potatoes that you see there. Those are like, you know, table potatoes. Basically, that looks like a russet potato right there. That's like a normal-sized russet. I can tell you, you got something in it.
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Yeah, so the genetics on AB... You can see they're like little purple, tiny little purple potatoes. The genetics on CD are like these little white, you know, tiny little ball potatoes.
All-In with Chamath, Jason, Sacks & Friedberg
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But when you put those two together with boosted and you combine all the DNA from AB and all the DNA from CD, you get this crazy high yielding potato ABCD, which, by the way, is higher yielding than the market variety that's usually grown in the field on the far right.
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We are. And so we're working on doing this with Russet. We're working on doing this with every major potato line. Sorry, the improvement you'll see is actually in yield. So it's not the size of the potato. It's the number of potatoes that are being made.
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Yeah, you're convincing yourself that you have all this control and ways to change the outcome. You're literally flipping a card. It's high card. It's basically a high card. That's all it is.
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Oh, no, they're awesome. Yeah, they're potatoes. And we do a lot of analysis.
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No. I mean, again, one of the other advantages of the system that we've developed Let me go back here, and I just wanna take two seconds on this. One of the other things this unlocks is creating actual seed that you can put in the ground in crops that you can't do that in today. So potatoes, the third largest source of calories.
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But the way we grow potatoes, you guys remember the movie, The Martian, you chop up potatoes and you put them back in the ground. Because the seed that comes out of a potato, which grows on the top in the flower, Every one of those seed is genetically different because of what I just showed on this chart, right? You get half the DNA from the mother, half the DNA from the other.
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So every seed has different genetics. So there's no potato seed industry today. And potato is like $100 billion market. With our system, not only can we make potatoes higher yielding and make them disease resistant, What we also make is perfect seed.
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So farmers can now plant seed in the ground, which saves them about 20% of revenue, takes out all the disease risk, and makes things much more affordable and easier to manage for farmers. So it creates entirely new seed industries. So we're going to be applying this boosted technology that we've discovered across nearly every major crop worldwide.
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It'll both increase yield, but it will also have a massive impact on The ability to actually deliver seed and help farmers and make food prices lower. Is it more expensive? No, it's actually cheaper. So higher yield, lower cost. Do you need more water? Less water, less land, less energy. Do you need more fertilizer?
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Fertilizer usually scales with biomass, but these sorts of systems should be more efficient. So fertilizer use per pound produced should go down significantly. as we get to commercial trials with all this stuff. And we're doing this across many crops. So there's a lot of work to do in terms of like, how do you scale the production in the fields?
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we added ai to enterprise chat we cleaned up your slack so yeah when you invest we've invested a ton of money this was stealth for five years we put a ton of money into this business so when you invest like um i mean north of 50 north north of 50 yeah 50 million five years and you don't have a product in market yet wow that's some we actually have some product yeah so i haven't talked about the way we've been making money in some of the business we've been doing okay
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You can control for that when you breed. So the selection of what plants you put together in the boosted system allows you to decide. Do you want small, medium, large? That's all part of the design of which plants do you want to combine.
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No, the goal is to make more russet potato per acre so that we use less water, we use less land, farmers can make more money, people pay less for food. That's the goal. And so it's all about yield. It's not about changing the characteristics.
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And I'm watching the smartest guys we know staring at the window at the little machine that tells you whether bank or player won. And they're studying it, rubbing their chin, doing an analysis. It's been four reds. It's got to go black. Hellview's like, I'm calling it now. Bank, bank, player, player, player. And all the guys are like, let's do it.
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There are some crops where you want to change the characteristics, like you might want to make bigger corn kernels and bigger cobs on the corn, which is another thing that we've done. And that's actually been published in our patent. And the reason, by the way, I'm talking about all this is some of our patents started to get published last week.
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And so when that came out, the word started to get out. And that's why we decided to get public with what we've done, because it's now coming out in the open.
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Awesome question.
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It's a great question. I'm so glad you asked it because that's one of the key drivers for the business is that we can now make crops adapted to all sorts of new environments that you otherwise can't grow food. Today, there's close to somewhere between 800 million and a billion people that are malnourished. That means they are living on less than 1200 calories a day for more than a year.
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But on average, we're producing 3,500 calories per person worldwide in our ag systems. The problem is we just can't grow crops where we need them.
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And so by being able to do this sort of system where we can take crops that are very drought resistant or can grow in sandy soil or very hot weather and adapt cooler climate crops to those regions through the system, we can actually move significantly where things are grown and improve food access in regions of-
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And so there are known markers associated with known phenotypes. A phenotype is a physical trait of a plant. And so we know lots of markers for every crop that we grow. Markers for disease resistance, drought resistance, markers for big plants, short plants, etc. And so what we do is we look at the genetics of different plants that we might want to combine into the boosted system.
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And we say these ones have these markers, these ones have these markers, let's put them together. And then that that'll drive the results. One of the other interesting things we're seeing, which I didn't get too much into in the slides. It's not just about combining traits. But it turns out, when you add more genes together, Biology figures out a way to create gene networks.
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And then everyone's like, heads, heads, tails, tails.
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These are all these genes that interact with each other in ways that are not super well understood, but it makes the organism healthier and bigger and live longer. This is why mutts are healthier and live longer than purebred dogs, because they have more genetic diversity.
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So there's a lot of work now in what's called quantitative genomics, where you actually look at the statistics across all the genes. You use a model, and the model predicts which two crosses you want to make out of hundreds of thousands or millions of potential crosses that the AI predicts. Here's the two best ones to cross because you'll get this growth or this healthiness factor that'll emerge.
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We're not going to farm. Farmers are our customers. And so there are different ways to partner with people in the industry who already have seed businesses or already have genetics and help them improve the quality of their business. And then there's other industries like in potato where we're building our own business of making potato seed, for example.
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So every crop and every region is actually quite different. So it becomes a pretty complicated business to scale. We're in the earlier days. We're already revenue generating. I would like a sweeter blueberry.
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Yeah. Well, somehow we made it about us. Yeah, no, no, look, I think that's, it is all about you guys. Tell us about the blueberries, sorry. Well, no, every year, Driscoll's puts out a special labeled package called Sweetest Batch. And they just had the sweetest batch of strawberry and blueberries. I don't know if they're still in the stores, but they only last for like a week or two.
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And that's the best genetics only grown on a small number of acres. Really incredible.
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See if they have it. So I got it a few weeks ago. It's quite delicious. Anyway, let's just say we know the berry market very well. My co-founder, CTO, Judd Ward, whose brilliant idea Boosted Breeding was many years ago, who I met because they had a New Yorker article on Judd. I cold called him and said, hey, will you come in and give us a tech talk?
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We started talking and Judd came up with this idea for Boosted Breeding. And so we started the business. with Judd and Judd ran molecular breeding at Driscoll. So we have a lot of Driscoll's people that work at Ohalo. We know the market really well.
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So we've spent, we've spent 50 million bucks on, you know, plus on this business today. So we have filed for IP protections that people can't just rip us off. But I would say, I think that the real advantage for the business is arises from what we call trade secrets, which is not just about taking patents and going out and suing people. That's not a great business.
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The business is how do you build a moat and then how do you extend that moat? The great thing about plant breeding and genetics is that once you make an amazing variety, the next year the variety gets better and the next year the variety gets better. And so it's hard for anyone to catch up.
All-In with Chamath, Jason, Sacks & Friedberg
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That's why seed companies generally get monopolies in the markets because farmers will keep buying that seed every year, provided it delivers the best genetics. And so our business model is really predicated on how do we build advantages and moats and then keep extending them rather than try to leverage IP. So I'm a big fan of like building business model advantages.
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No, I think... So first of all, farmland in America is mostly family-owned. It's about 60% rented, actually. So a lot of families own it, and then they rent it out because they stopped farming it. But the great thing that we've seen in agriculture historically is that the more... Calories we produce, the more food we produce, the more there seems to be a market.
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It's like any other economic system. What about wheat and rice? Yeah. So those are calorie sources one and two. And there's certainly opportunity for us to apply our boosted systems there. The big breakthrough with potato is we can make potato seed using our boosted system in addition to making better potatoes. McDonald's is the largest buyer of potatoes, yeah?
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So in the US, 60% of the potatoes go to French fries and potato chips. McDonald's buys most of the fries. PepsiCo under Frito-Lay buys most of the potato chip potatoes. 40% are table potatoes. In India... 95% of the potatoes are table potatoes. They're eaten at home. And the Indian potato market's three to four times as big as the U.S. potato market. In Brazil, it's 90% table potato.
All-In with Chamath, Jason, Sacks & Friedberg
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So all around the world, potatoes are different. The U.S. is, you know, unusually large consumers of French fries and potato chips.
All-In with Chamath, Jason, Sacks & Friedberg
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in the back from the besties actually doing work.
All-In with Chamath, Jason, Sacks & Friedberg
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Well, I appreciate you guys letting me talk about it today. I'm excited to share it.
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I love it. It's been, yeah, building stuff is hard. There's always risk. It's a lot of work and a lot of setbacks, but man, when you get stuff working, it's great.
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It's magic. So there is a path.
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Yeah, I mean, more importantly, it should limit the approval or action of certain programs that you might otherwise want to do in a normal environment, but in an inflationary environment, you don't have the flexibility to do them. Student loan forgiveness is a really good example. Is now the time?
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To do student loan forgiveness, or do we wait for inflation to temper a bit? Is now the time? So there's just a lot of these examples that actually the opposite should be true. Yeah, but none of...
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Let me just make one comment, J. Cal, before we move on about the Druckenmiller investment statement. Of course. And I just wanted to say, I think what it highlights about Druckenmiller and call it a rift in investing philosophy or skill is the difference between precision and accuracy.
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What I mean by that is precision really references that you do a lot of detailed analysis to try and make sure you understand every specific thing that is going right or could go wrong.
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But the problem... And so that means you, for example, might do a ton of diligence on a company and make sure you understand every dollar, every point of margin, all the specifics of the maturation of that business and where they are in their cycle. But... You could be very precise, but be very inaccurate.
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For example, if you miss an entire trend, someone could invest in Macy's back when Amazon was taking off and have done a lot of precise analysis on Macy's margin structure and performance and said, this is a great business. But they missed the bigger trend, which is that e-commerce was going to sweep away Macy's. And consumers were simply, that's not possible in the analysis that they were doing.
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Well, yeah. And so like... Do you want to show that? No, no, no, no. Do not poke the tiger. Let's not get into it with other podcasters. The worst spread trade in history. Yeah, let me just finish the statement. But the other one is being accurate. And accurate means you get the right bet, the right sentiment, the right friend.
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The problem with being accurate, you could have said in the year 2000, hey, the internet's going to take off. And you could have put a bunch of money in, but the problem was you were right. You just had to have the necessary patience. And so accuracy generally yields better returns, but it requires more patience because you can't necessarily time how long it will take for you to be right.
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So a guy like Druckenmiller is making an accurate bet. He bets correctly on the trend, on where things are headed. He doesn't necessarily need to be precise, but he has the capital and his capital structure that allows him to be patient to make sure that he eventually gets the return.
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What was the movie she was in? Bound. Bound. That's what it was. Yeah.
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The great thing about network effect businesses is there's a trend line that sustains because it builds if it's an appropriate network effect. So you can be accurate about buying into the right network effect business. You don't need to use all of this diligence to be perfectly sound and
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around the maturation of the revenue and the margin structure and all that stuff as long as the trend line is right and you're willing to be patient to hold your investment. I think Druckenmiller's point is incredible. He took a look, he very quickly made a macro assessment. From a macro perspective, what Millais is doing
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That is a tour de force.
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is significantly different than what we're seeing in any other emerging market, let alone mature market with respect to fiscal austerity and appropriateness in this sort of inflationary, global inflationary environment. And he said, you know what? I don't see any other leader doing this. This is a no brainer bet. Let me make the bet.
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And as long as he's willing to hold this thing for long enough, eventually the markets will get there and call it a spread trade against anything, he'll be proven right.
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Oh, my God.
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This is where I go. I mean, like watching Sax's demo earlier, how much progress and how seamless that product works with the features it has enabled by the underlying models. You just get to thinking how all of these vertical software applications become completely personalized and quickly rebuilt around AI. Totally. It's so obvious.
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And you got it done in five seconds. It's incredible. Totally. And then imagine building that same sort of capability into a very specific vertical application that's specific to some business function. And you can probably spend a couple minutes or an hour building that function. And then it saves you hours a day in perpetuity. Yeah.
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And I think that's why these tools companies or the tools products that Google... Microsoft, Amazon, and a few others are building are actually incredible businesses because so many enterprises and so many vertical application builders are going to be able to leverage them to rewrite their entire business functions.
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What happened, I've been talking with Sam for a while. A year. About coming on the show. And every time I see him, we're like, hey, you should come on the show. He's like, I want to come on the show. Okay, let's find a date. We never got a date that worked. I saw him in March and he said, hey, I want to come on the show. I said, okay, well, come on. Let me know when it works.
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And a couple of weeks later, he's like, what about this date in May? And I'm like, yeah, that's fine. We can make that work. He's like, well, I've got a big announcement we're going to be doing. And I was like, perfect. Come on the show. That sounds great.
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I bought some. No, your original stock. Did you clear it at some point? Oh, no, I sold all my stock back when I started Climate because I was a startup entrepreneur and needed to live. So, which, you know, I recently did. I did the math on it. It was pretty, it'd be worth a lot. It would be worth billions or tens of billions? No, no.
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No, no. Okay. You know, I was not a senior exec or anything. I think what you said is probably true. So that's accretive.
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I think the other thing that's probably true is a big measure at Google on the search page in terms of search engine performance was the bounce back rate, meaning someone does a search, they go off to another site, and then they come back because they didn't get the answer they wanted.
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And then the one box launched, which shows a short answer on the top, which basically keeps people from having a bad search experience because they get the result right away. So a key metric is they're going to start to discover which vertical searches, meaning like, hey, cooking recipes, that kind of stuff. There's lots and lots of these different types of searches.
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And then the night before, he asked me, he told me, he texted me, he's like, hey, we're actually not going to have this announcement happen tomorrow. It's going to be delayed. He didn't tell me how long. And I'm like, well, is it GPT-5? He's like, no, it's not GPT-5. And I was like, okay, well, you know, come on the show anyway.
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that will trigger a snippet or a one box that's powered by Gemini that will provide the user a better experience than them jumping off to a third party page to get that same content. And then they'll be able to monetize that content that they otherwise were not participating in the monetization of.
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So I think the real victim in all this is that long tail of content on the internet that probably gets cannibalized by the snippet one box experience within the search function. And then I do think that the revenue per search query in some of those categories actually has the potential to go up, not down.
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You keep people on the page so you get more search volume. there, you get more searches because of the examples you gave. And then when people do stay, you now have the ability to better monetize that particular search query, because you otherwise would have lost it to the third party content page.
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So for example, selling the steak knives is another is you know, it's kind of a good example, or booking the travel directly and so on. So by keeping more of the experience integrated, they can monetize the search per query higher. and they're gonna have more queries, and then they're gonna have the quality of the queries go up. So I think it's all in.
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There's a case to be made, and I haven't done a spreadsheet analysis on this, but I guarantee you, going back to our earlier point about precision versus accuracy, my guess is there's a lot of hedge fund type folks doing a lot of this precision type analysis, trying to break apart search queries by vertical,
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and try to figure out what the net effect will be of having better AI-driven one-box and snippets. And my guess is that's why there's a lot of buying activity happening in the stock right now. And I think they're probably all missing, to Moff's point, a lot of these call options, like isomorphic labs. I can tell you Meta and Amazon- Waymo.
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Meta and Amazon do not have an isomorphics lab in Waymo sitting inside their business that suddenly pops to a couple hundred billion of market cap. And Google does have a few of those.
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There may be. Look, I mean, there's Calico. No one talks about Calico. I don't know what's going on over there.
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Because he didn't tell me when he's doing the announcement or when it's being pushed to. So it didn't seem like that big a deal. And I thought we were just going to be able to have a good chat anyway. So it's really unfortunate, I think, the fact that the announcement happened two days after and he had to stay quiet about it during our interview. But that's the story.
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I think in the future, if someone says they've got a big announcement to do, we should probably push them if they have to delay or something like that. Don't beat yourself up. But I don't think we're going to be doing a lot of these interviews anyway. I think people clearly don't love them and it's better for us to just kind of hang out and talk. Yeah.
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People don't remember they had their own video game. I was at a conference a couple of years ago that Jeff Bezos spoke at. I think he's given this talk in a couple other places. You could probably find it on the internet. But he talks about Amazon's legacy of failure and how they had the fire phone and the fire this and the fire that. And he's like, our job is to fail.
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We have to make these blunders. But what makes us successful is that we learn from the failures and we make the right next decision.
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One and done. But this is how you stay competitive. If you're a big founder-led tech company, the only way you're going to have a shot at staying relevant is to take big shots that you're going to fail at. I remember this one. The iPod HiFi. You have to do things that you're going to fail at.
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It was supposed to happen same day, so it's unfortunate this all worked out this way.
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Today is the day. Today is the day. Okay, good.
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And we'll make sure that consumers have choice and they have the ability to go where they want to go. And it's not just defaulted by the telcos or the handset manufacturers. So that was the reason. And obviously, they ended up making their own fork of Android, which is the most popular fork of Android that has Google as a default search engine. So yeah, and they get license fees from that.
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But fundamentally, it's really just in service of making sure that people go to Google search. So where that ends up sitting in a split up company, I have no idea. And Chrome, similarly, you know, Google originally supported Firefox and gave a lot of money to Firefox. And then Firefox just wasn't moving fast enough.
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So Google started hiring Firefox engineers and built Chrome in-house as a way to keep Netscape and Internet Explorer from blocking access to Google search and defaulting. And they built a default to Google search, obviously. What do you think, Jacob?
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Think about the math. Sorry, just real quick. Think about the math on that. So let's say it spins out and it generates 30 billion of revenue a year and Google owns the majority of it. And eventually they'll sell it down. But that business will be valued on the money that Google's paying. So Google will make that equity value back because they own the shares.
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I want to just underline what Chamath said real quick. Being big... can be very good in the sense that it can drive an ability to invest in innovation that is not possible without the scale and the significant cashflow that's being generated by being that big. And AT&T is a great example, Bell Labs,
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So the way AT&T was set up is there was all the local telephone companies under this Bell system that AT&T owned. And then Western Electric was the company that manufactured all the telephone equipment that was put into the telephone system. And then Bell Labs was the third entity. It was the research arm. And all that they did at Bell Labs was do research. And they were fully funded.
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They had all this cash flow pouring into them so they could discover and work on and invent whatever they wanted. With that capital, Bell Labs is so insane. If you guys haven't read any of the books on Bell Labs and what was discovered there and how it operated, it truly is like the most innovative center ever in human history. But they invented like antenna arrays. They invented microwaves.
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They invented radar. They invented the transistor. They invented information theory, which was the basis for everything in the Internet. There was even some efforts to try and invent a nuclear bomb before the Manhattan Project started. They invented integrated circuits and on and on and on and on.
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And that's because they could invest all this money in doing this research that would have been very difficult for a small startup or a company that's trying to grow and is barely profitable to be able to do. At Google, they've invested billions of dollars in Waymo.
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And I think as we all know, Waymo really was, if not the leader, but the inspiration for a whole generation of autonomous driving that ultimately will come to market and will really transform our lives in a meaningful way.
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In the same way Amazon and Microsoft and Meta have all invested tens of billions of dollars in innovation, look at what Zuck is doing at Meta with the open sourcing of the Lama models. It's incredible that
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would have never been possible if you had a small company that was trying to get profitable so i just want to highlight like these businesses just because they're big and successful doesn't necessarily mean that they're stifling innovation in fact they may be accelerating innovation and enabling progress i'm just pointing out that the cash flows that are being generated the way they're investing those cash flows is pretty pretty impressive and we lose that if we end up going after every big company just because they're big and saying hey we should take away their ability to do this
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CEO of Chipotle. Chipotle. Who knows? I don't need it in this place.
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Well, the one argument is there's a founder-led problem here, which is when the founder steps out and professional management takes over and you have the same expectations that you had when the Starbucks faces many more kind of macro economic challenges. Nick, if you pull up a Starbucks financial report.
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So here you can see that their net revenue growth was only a 1% year over year, but their operating margin has been on the decline. So they have not really been able to boost their operating margin very much in the past five years. So while they've raised prices, they've had a really hard time making more money.
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And that's because the cost of food and the cost of labor and the cost of rent and the capital expenditures needed to upgrade stores has far exceeded the ability for them to grow revenue and compete. And now revenue is flatlining because consumers are getting tapped out with respect to how much they can spend.
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And there's only so much innovation you can really do to charge more, get people to come in the store more. and drive up revenue. Brian Niccol has an incredible reputation. Prior to Chipotle, he ran Taco Bell. And he ran Taco Bell for several years and made it one of the most profitable QSR or quick serve restaurants in the world. He did this by focusing on every nickel.
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He is notorious for being a cost cutter, for being an efficiency driver, for being a productivity hound. He goes into the business and he figures out every step in the supply chain, every step of the operating activities of the employees in the stores and figures out ways to make sure-
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Keep going. That was good. And... And so he was recruited heavily. I don't know if you guys remember Chipotle's founder was running Chipotle. And at the time there was a lot of investor activism around Chipotle because they were wasting money like no one's business. The guy had a private jet. He was flying his management team back and forth between Denver and New York.
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They were spending money on crazy projects. And the board fired the CEO, founder of Chipotle, brought in Nickel. Nickel came in and made Chipotle an incredibly profitable, growing business. And the expectation is he'll come in and do the same here, that maybe over the years, Starbucks' success has bred laziness.
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Starbucks' success has bred fat, slowness, productivity decline, and that this guy is the right guy to come in and find all the nickels. And Brian Nichols is probably the right guy, which is why you're seeing the stock kind of rally as hard as it has.
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Oh my God, well done. So good.
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I'm going to go get an espresso after this. This is making me want an espresso.
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No, but I mean, here's what happened. The thing about Starbucks, I study Starbucks, and I've spent some time with Howard Schultz, actually, a couple years ago. Well, you did retail, right? Maybe you could talk about your eats experience.
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But the thing about Starbucks is they realized early on that when you can customize a consumer experience, the consumer comes back more frequently. So when you see your name written on that cup, you feel like you're getting your product. You're not buying an off-the-shelf product. You're getting a custom personalized experience. What that led to is people customizing their drinks.
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And what did they find that they liked when they customized their drinks? Sugary sweet add-ons. And then that became more and more of the standard menu. And then that just kept evolving.
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And that's just the consumer feedback mechanism working, which is to Chamath's point, led to 60 gram sugar drinks that are now the standard product at Starbucks, not an espresso or a cappuccino, which is how they started. And it's really unfortunate.
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I don't think that Brian Nichols is going to focus on that, to be honest, given his background with Taco Bell and Chipotle, that there was never anything.
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Jake, what do you think? I mean, what do you think about Starbucks?
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Yeah, I will also, I will predict... Yeah, no.
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Yeah, we had automation. I actually worked on an automation project with Jonathan at Sweetgreen and Starbucks and Chipotle. Oh, you did? So I knew them all. Yeah. And then the Chipotle CEO got fired. We were going to roll out automation with Chipotle and he got fired and Nickel came in and our deal blew up. it killed the deal.
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Oh my God. So it was gonna take out, basically these businesses today are running at, call it 30% EBITDA margins at peak performance. That's like Chipotle's best class. By taking out labor, you could probably take out another 20 points of cost, which could translate into lower prices for consumers, higher throughput, lower wait times.
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All of these kind of experiential differentiators are gonna be significant. Certainly true for Starbucks, certainly true for Sweetgreen.
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I would expect that with Nickel coming in, you'll see some experimental stores, as you point out, J. Cal, that'll be more highly automated, but will also, I think one of the first things you're gonna see from Nickel within the first year at Starbucks is a reduction in the complexity of the menu.
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This is something he's done historically, and he focuses, like he did at Taco Bell, he creates a couple of key highlight products, And creates these innovative product ideas. And then those become the banners that bring people into the store. But it's a simpler menu with kind of more attractive, interesting products that bring people in.
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And then if you couple automation to reduce some of the cost, you can bring that labor cost down.
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There's four quintillion baristas. ordering options at Starbucks today. And so the expectation has always been that that is what brings people coming back to the store. But what Nickel has shown in the past with Chipotle and with Taco Bell is you can actually have a simpler menu with a few points of customization. You don't need to have infinite customization around everything.
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The cashier problem also creates a wait time problem because it's a serial ordering process. Everyone stands in line, they order one at a time. And there's only one, and so the barista's just taking-
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I mean, this clip is so brutal. We should talk about this in the context of Eric Schmidt's interview as well, J. Cal. Show the clip and then let's talk, let's show Eric Schmidt and talk about like work culture in America. I think this is a really important point.
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It's not just Google.
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This makes me so uncomfortable just hearing that, I feel. Holy ****. I mean, retire, bruh. Just retire. What does America value is the real question. Does America value success, performance, or does America value comfort? And the problem is American work culture has shifted to valuing comfort. And that is the inevitable outcome of decades of extraordinary success.
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And now the performance culture is losing to the comfort culture.
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Why did you do a paid promo for Bucks at Woodside? I don't, they gave you a hat.
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No.
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Using the podcast to sell onion rings. Perfect.
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I mean, you're selling potatoes and Chamats is getting Laura Piana. To sell onion rings.
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Well, influence our culture.
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Bell Labs did the same thing. Bell Labs had a quad that you had to walk through to go from meeting to meeting. So everyone interacted, intersected.
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Yes. I unequivocally hate socialism. Socialism destroys innovation, destroys productivity, and destroys individual liberties. Agriculture and food markets have insanely competitive dynamics because there are commodity markets. There are tons of competitors. There is no monopoly in making food. There is no monopoly in making CPG products. There is no monopoly in retail.
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There is no monopoly in grocery stores. It is a small margin, highly competitive, highly fragmented free market. And the free market works in that everyone is always competing with each other, creating new productivity improvements. And as a result, over time, prices come down, except when the government intervenes and gets involved. So I would argue...
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that the real cause of price inflation in food is not the supposed price gouging by corporate players in the ag and food industry, all of whom are deeply competitive with one another, but rather is the result of the inflation associated with government spending and stimulus coming out of COVID. Nick, exhibit one. The Fed balance sheet.
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From COVID to today, the Fed balance sheet grew from $4.2 trillion to $7.2 trillion, a growth of 70%. The Federal Reserve went out and they bought assets and they issued debt to banks and introduced liquidity into the system. If you go to the next slide, as a result, the M2 money supply increased from $15 trillion to $21 trillion since COVID, a 40% increase.
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Okay, so now there is more money in the system, so the cost of everything should go up, which is exactly what we've seen. We can walk through a couple of the other commodity price charts from the St. Louis Fed. Here is the price of electricity. As an example, the price of electricity has gone up a little bit less than the M2 money supply.
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But the truth is, when you start to actually look at ag commodity prices over time, what's happened is there was certainly a boost coming from COVID, but the competition and the challenges in overproduction in the ag markets has started to hit. and started to bring prices back down. So here's the price of strawberries. Strawberries today are selling for less than they were pre-COVID.
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Potatoes are now back to where they were pre-COVID. Now, let me give you some statistics on some of the supposed price gouging companies in the industry. Kraft Heinz stock pre-COVID was 29 bucks a share. Today, Kraft Heinz stock is 34 bucks a share. 2019 revenue of 25 billion, 2023 revenue of 26 billion. EBITDA on 2019 of 6.1 billion, EBITDA on 2023 of 6.3 billion.
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There's not a lot of profit gouging. In fact, Kraft Heinz has not been able to keep up with the inflation. Starbucks, which we just talked about, their stock was at $90 pre-COVID and today, 93 bucks. 2019 revenue of 26 billion, operating income of 4.1 billion, 2023 revenue of 36 billion, but operating income only 5.9. Margins have come down in Starbucks. Nick, if you pull up the McKinsey chart,
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This is a study of the grocery industry. The State of Grocery in North America 2023 by McKinsey. Accelerating pressures on profitability to cope with the pandemic's upheaval, grocers have had to dramatically increase capex, increase supplies. As a result, they've seen a significant impact on margins. Here's the margin profile pre-pandemic and today.
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Gross margin has declined by two points from 47.6 to 45.6. EBITDA margin has declined by one and a half points. And now let's just go to the final chart, which is CPG companies, the companies that make food and sell it to consumers. As you can see, during the COVID era, the three-year rolling TSR has declined since COVID across the board. So food companies are seeing food prices come down.
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So farmers are really suffering. Labor costs have tripled since the pandemic, but they're still having to sell products at the same price. CPG companies have lower margins and supermarkets have lower margins. So there is nowhere in the ag or food supply chain that we are seeing fundamentally price gouging or profit taking happening.
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What has happened is the cost of labor, the cost of moving stuff around, the cost of fuel, the cost of electricity, the cost of goods has all risen with inflation because of the increase in the money supply and federal spending and the stimulus associated with the Federal Reserve buying assets onto their balance sheet.
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So arguably, I would say that trying to step in and cap prices will reduce competition and as a result will reduce investment in improving productivity. And we have seen this countless times with every socialist experiment in human history has started with caps on food. And it has resulted in bread lines like you see in the image behind me today, as we can see in Soviet Russia. This is a mistake.
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It is a problem, and it's anti-American. It is anti-free market. It is anti-innovation. It is anti-productivity. And ultimately, it's anti-liberty. And I cannot stand it. That's my rant.
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To support your point and what Chamath was messaging on our chat, look at Walmart stocks up 7% today because they offer lower priced solutions to consumers and Dollar General and Dollar Tree are rallying as well. When the market competes, consumers benefit and there are companies that will win. And the companies that try to price gouge and the companies that try to charge too much will lose.
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Starbucks has been trying to charge too much for sugar water. They have a real problem they are now tackling. Walmart is trying to bring value to consumers. They are winning. That is how free markets work. When the government steps in and says, here's how much margin you can make or here's how much prices should be, it ruins everything.
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And the entire incentive structure goes away and you end up with bread lines. Saxy poo, what do you got?
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and your thoughts broadly on this. I'll just start by commenting. I'm not really sure what the improvement to consumer pricing or competition would be in different breakup scenarios. I'd really like to understand the DOJ's analysis on that. How does breaking up one of these things improve the consumer experience?
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J. Cal, do you agree? Do you think her strategy is off at this point? And Is it starting to hurt her to put out these proposals?
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I could see the case for Android because Android defaults to Google search, but again, Android's an open source operating system. And so everyone has their own fork or a lot of the handset manufacturers will have their own fork of Android. Obviously the Google fork defaults to Google search. So it benefits Google services quite well.
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I think an educated voter base is going to wake up to that. And particularly in that independent segment, there's going to be a lot of acknowledgement that maybe these are not going to be the right policies.
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I think that would be an analysis that the DOJ would really have to kind of prove out that there is real anti-competition associated with Google's influence over the open source Android operating system fork that they manage and license out. I think understanding that would be good. I do think that there's a lot of value unlock in YouTube. So if Google were to just generally spin out YouTube,
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Well, I wanted to just highlight the Starliner project and the issues.
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Give us an overview and then let's chop it up as we wrap. Two NASA astronauts flew on the Boeing Starliner capsule. June 5th and they docked with the ISS and they're now stuck on the ISS and they might be stuck there until February because the Starliner has a number of technical issues. The astronauts cannot get back in the Starliner and just fly back to Earth.
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Speaking of looking healthy. Celebrated birthday with Jason Kuhn yesterday. Happy 39th, Jason Kuhn.
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NASA's kind of evaluating the options here on what to do and whether to put them on a SpaceX Crew Dragon capsule in February to get them back. So I just want to talk a little bit about the history of this project. and provide a little context before we highlight the particularly acute story of two astronauts being stuck in space right now, which is an incredible story.
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So this is a next gen space capsule that was designed to take people to and from low Earth orbit, basically to the ISS. And NASA, if you guys remember in the 2000s, decided to stop making their own vessels and they're gonna start using third-party contractors. So they went out and had a competitive bidding process. And ultimately in 2010, they gave both SpaceX
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and Boeing, the winning contracts to develop these commercial crew transportation capabilities. SpaceX obviously developed the Crew Dragon capsule. So it was unveiled in 2010 as the CST-100, Boeing's first commercially developed space capsule. The company would take on all the financial risk for developing it with a fixed price contract from NASA of $4.2 billion.
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To date, by the way, Boeing has taken a $1.6 billion financial hit on the development of this program. SpaceX, by the way, won a $2.6 billion contract to develop the Crew Dragon capsule. And just to give you guys a sense, the Crew Dragon capsule has flown 13 missions thus far to the ISS. And this was the first... crewed mission flown by Boeing, both of which got contracts at the same time.
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So originally, it was going to be a 2017 launch timeline. And I just want to hit on some of the history of the Starliner problems. 2016, it was delayed.
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that contract with Boeing to develop this Starliner capsule. So the first issues arose in 2016 when there were design problems. The first crewed flight was then pushed back to be scheduled for 2019. In 2018, they found issues with propellant leaks, which led to more delays. 2019, a test flight parachute failed.
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December of 2019, they had their first uncrewed test flight and there were software errors that would have caused destruction of the spacecraft. This led to NASA and Boeing submitting 80 different changes that needed to happen before they did their next uncrewed test flight. So they then pushed that all the way out to 2021. Boeing ended up saying it cost us half a billion dollars to do that.
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Then in August of 2021, 13 propulsion system valve issues were discovered on the launch pad. The flight was aborted and the capsule was returned. They eventually got it up again in space in May of 2022 and it docked with the ISS. and it returned back to Earth, even though one of the parachutes failed when it returned to Earth, it still made it down.
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that is probably a business that on its own would attract an investor base that might otherwise not want to get into the conglomerate. And you know, there's always this notion of what's called a conglomerate discount. When you put a lot of different businesses together,
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This again led to the 2023 first crewed launch, which means people are in the capsule. This was originally supposed to be in 2017, and they kept pushing it back because of more issues with the parachute system. And then they finally got it launched in June 5th of 2024 with two astronauts on board to go to ISS and come back.
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On the way, they discovered that five out of the 28 maneuvering thrusters, which is how they can move this capsule through space to get it to dock with the ISS and ultimately make its way back to Earth, were malfunctioning. They have now discovered five helium leaks. Helium is stored in a pressurized system to actually control those thrusters and make it move through space.
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And now they may not even be able to get this capsule to fly off of the ISS.
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So on June 28th, NASA announced that while the Starliner is theoretically capable of returning the astronauts to Earth in an emergency on the ISS, the capsule is not approved to fly until these thruster issues and the leaking helium are figured out or better understood, and they have now pushed the decision to the end of August. It would be massively,
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embarrassing for Boeing if these two astronauts had to be rescued by SpaceX. It's a Crew Dragon capsule had to find its way up to the ISS. They hopped on and they came back to Earth. Clearly a massive problem, but it's certainly a personal and a human story now with these two astronauts stuck on the ISS.
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And to be clear- You've had a lot of comments on Boeing in the past, but I mean, does this feel like a continued underscoring of the issues at Boeing?
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Yeah, so the NASA Cargo Dragon, which only has a cargo on it, not people, has completed nine successful missions to and from the ISS. There are six more planned. And they've obviously done 13 missions with the Crew Dragon. And by the way, I don't know if you guys know this.
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This is a surprise, but exciting to share that we are going to have a Crew Dragon capsule from SpaceX at the All-In Summit in LA parked on the launch. You can actually go inside and check it out and take a little tour. It's going to be amazing. So thank you to the SpaceX team for bringing the Crew Dragon capsule.
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the businesses in aggregate get valued less than the individual parts would be valued on their own because different investors interested in a business investment thesis would like to bet on cloud, would like to bet on YouTube, would like to bet on AI. And so each one of these kind of like segments, if they can be unlocked, can actually be value creating in terms of overall market cap.
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It's 100% Shamath. That's a perfect example.
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The challenge is the way YouTube's infrastructure operates. It operates on shared infrastructure with the rest of Google services. So does cloud, so does search, so does AdWords. So there's one common... a cloud infrastructure that everything runs on. And then there's one common advertiser pool.
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I'd like to go hunting. Churchill took a bath every day.
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I'll call you later.
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Yes. We haven't had a general facts update in a while. I actually want to hear your take on the facts. Like, what is the real story? Yeah, talk about the humiliation of Putin. Yeah, tell us. Yeah. What is the real story with the Ukraine counter invasion into Russia?
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There are dedicated advertising salespeople within YouTube, but there's also dedicated shared infrastructure on advertising between YouTube and search and AdSense and so on. And there's ad sales teams that actually can sell across search. and third party publisher sites and YouTube.
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We did a long mountain bike ride with our other buddy, Z, and had a little family barbecue last night. Everyone had a good time.
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And so, you know, breaking up those shared teams becomes a little more technically difficult, but YouTube certainly seems like an unlock. The question is what happens with all the infrastructure layer? Does that go with cloud? And if it does, then YouTube, AdWords and search all become customers of cloud. So that might be one way that this could work.
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But I think net net, if this were to happen, there could be a lot of upside in the market cap. I'll also say it just feels like the tenor of all of this is anti success. and not anti-competition. And anything that's kind of successful or big is automatically deemed to be a monopoly.
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And I think we really have to kind of understand how are consumers and the market for competition being affected by having all these things together. And that's what should really be focused on and studied, not just the fact that something is big and successful. And we'll see how that all plays out.
All-In with Chamath, Jason, Sacks & Friedberg
Break up Google, Starbucks CEO out, Kamala’s price controls, Boeing disaster, Kursk offensive
Let's just say I show up with my own food to a barbecue.
All-In with Chamath, Jason, Sacks & Friedberg
Break up Google, Starbucks CEO out, Kamala’s price controls, Boeing disaster, Kursk offensive
Yeah, so they were both created... to avoid third parties blocking access to Google search. That's why they were both started. And remember, Sundar was the product manager on Chrome originally. That was his big kind of product that he ran for quite some time.
All-In with Chamath, Jason, Sacks & Friedberg
Break up Google, Starbucks CEO out, Kamala’s price controls, Boeing disaster, Kursk offensive
So Android was all about making sure that the handset manufacturers didn't basically default consumers to do search and use the internet in a way that would disadvantage Google. So Google said, you know what, just like Zuck is doing currently with Llama, Google said, let's make an open sourced, mobile operating system that's better than any other mobile operating system.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
Well, look, I mean, at the end of the day, if people feel like they're progressing, they feel happier. They feel like they're not progressing, they're unhappy, regardless of their absolute state. You know, we talked about this with Jonathan Haidt on our interview show. We talked about this on the show in the past.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
I think that there's some studies that show that if income growth is not roughly 10% a year, you get an unhappiness indicator. And then there are other associations with that. Like, am I improving the size of my house? Am I able to buy a new car? Am I able to like progress in my career and make more money?
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
All these factors kind of play in and much of this ends up being buoyed by the political ideology of the candidate that's in the office and how they are popularizing what they are doing to help you progress, even if you are or are not actually progressing. So then people hear the political leadership say, this is what we're doing. You associate that as being positive or negative.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
If you're a Republican or you're a Democrat, you associate it as one or the other. And so you have this perception of progression without actually having economic progression be tied to it. So the reality is gets decoupled. So I think it's an excellent chart to kind of highlight that fact.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
I'm not sure how much it ties to this inflationary issue that we're dealing with right now, but I will tell you that, and I'll restate this again, Much of the inflation, like I think grocery prices are up 30 plus percent. Nick, you could probably pull this up since COVID.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
Yeah, the more globalized the businesses are that are providing the goods or services to us, the more likely they are to need to hike prices to make up for the inflationary cost structure in their business because of their global presence.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
The general statement might be made that perhaps the first AI mini bubble is bursting a bit and particularly with respect to the accelerated expectations that public market investors had for public market technology stocks, that perhaps now is the time for a bit of a reckoning, that perhaps this isn't going to happen at the same margin level or the pace that folks had modeled. Correct.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
And this is going to cause a bit of a setback.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
There's a cold hard truth here.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
Which is there is a ton of capital that was raised during the COVID bubble era and the Zerp era that needed a place to go. And a lot of the traditional businesses, traditional business models, traditional in the technology sense, SaaS and a lot of the biotech stuff, it all became- Apps. It became uninvestable.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
Then there's a lot of money in the public markets that was sitting on the sidelines, that was sitting in treasuries and so on. So every dollar is looking for growth, and there's a lot of dollars still sitting around out there from the Zerp era and coming into this kind of post-Zerp era, looking for a place for growth. And there is very little growth, as we talked about with the S&P 493,
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
not being very performative with respect to growth and revenue and having great outlook for the next five years. So then when there is a glimmer of upside, there's a glimmer of opportunity, even if it's just painting a picture of a growth story, all the capital drives into it. And we've all heard stories about these series A startups in AI getting bid up to $100 million valuation.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
And I've seen a couple of these where people have pitched me things on like protein modeling AI startups. And it's literally like two guys from Meta and OpenAI that left and started this company. And they get, they raised 30 on a 120 pre or something. And it's just two guys building a model. And that's because that capital needs to find a place where it can tell itself a growth story.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
And so I think that we're still dealing with the capital hangover from Zerp and the fact that there's a dearth of areas to invest for real growth that has allowed the AI bubble to kind of grow as quickly as it has. And now, as Chamath points out, we are kind of rationalizing that back. And I do think that there's going to be a reset.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
Now, I'll also say that the Goldman report, which I read, and some of the other analyses that have been done, I think there was some commentary or some analysis that, hey, it costs me six times as much as having an analyst do this work. Like the energy cost of the AI is still so high, the actual performance of the model is not good. But what that fails to, it's right and wrong.
All-In with Chamath, Jason, Sacks & Friedberg
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It's right in the sense that yes, it is more expensive today and the return on investment is not there today. It's wrong in that it ignores the performative model improvements that we're seeing in nearly any metric over the past couple of months. Every few months, as we know, we see new models
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
new improvements, new architectures, new ways of leveraging the chips to actually drive a lower token cost, to drive lower energy cost per answer, lower energy cost per run. And so every metric that matters is improving. So if you fast forward another 24, 36 months, I do think that there's a great reason to be optimistic that there's gonna be extraordinary ROI
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
based on the infrastructure that's being built, it's a question of, are you going to get payback before the next cycle of infrastructure needs to be made and everything comes back in?
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
We saw this during the dot-com boom, where a lot of people built out data centers, and by the time they were actually able to make money on those data centers, it was like, hey, all the new telco equipment, all the new servers need to be put in, and everything got written off.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
So there is a big CAPEC kind of question mark here, but I do think that the fundamental economics of AI will be proven over the next couple of quarters.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
A lot of outdoor sunning happening last couple of weeks. Yeah. Enjoying the vitamin D.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
There was effectively a center and left alignment that created kind of a surprise upset to the right that was surging in the polls leading into this election in France. And as we all saw, there was a lot of celebration in the streets and some rioting and so on. But it was a real kind of surprise shift left in this kind of important vote that happened in France. And then
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
The party stepped up and put forward these economic proposals.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
They said a 90% tax on income over €400,000 a year, a 14% mandatory wage increase, retirement age needs to be reduced to the age of 60 from 64, which obviously massively increases social spending, and that they want to put forward proposals to put in place price controls on things like food, electricity, gas, and petrol, so effectively intervening in kind of the free market pricing system.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
Last month in India, we also saw elections where the BJP did not get a majority. In Mexico, we saw Scheinbaum get elected with 60% of the vote, retaining the leftist government. Scheinbaum's platform is that the government's role is to really solve the economic inequality kind of throughout the country.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
She is a Jewish scientist who believes in technological progress, but her orientation is really around having institutions manage progress, not individuals in free markets. We've seen this broad across other places.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
In the UK, there was a big election in this past week, but I wanted to take a step back and just highlight that there is this kind of emerging tactical alliance that we've seen repeat a few times between the left and the center that pushes back against the right globally.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
But really what I think we're seeing is a much bigger shift where there's this bigger battle between socialism and free market democracy. And I think that We're seeing it all happen at once because of globalism and because of the fact that globalism has enabled, just like we've seen manifest in the United States, massive and significant economic progress
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Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
but at the cost of a small number of people becoming very wealthy and a large number of people feeling left behind as a result of the wealth accumulating in a major way to a small number of people. And the reaction that we're seeing in France, in India, in Mexico, in the US, in the UK is all very much kind of aligned. That there is this big push that social lift practices
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
can perhaps resolve the inequality and the inefficiencies that are seen in the markets today. And this is being manifested in a lot of really nasty ways. First of all, I think it's rationalized as being, hey, there's economic excess for a few while the majority are left behind.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
It's activated by big bureaucracy, by anti-free market principles, and by tax policies and spending policies that will ultimately cripple economic growth. And I don't want to say I'm against taxes because I'm all for taxes to make up for budget deficits.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
But I think the results are ultimately across all of this going to be what we saw happen in Argentina, which I think is on the other side of this problem, which is unsustainable debt accumulation, massive inflation and crippling unemployment. And I think that we should really take a hard look at what's happening around the world right now as being all related.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
All of the industrialized world is voting in a similar way and starting to shift in a similar way that we should be fairly concerned about and pay a lot of attention to. In the US, there's this expectation that Trump is gonna totally trounce Biden if Biden stays in the race.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
I think that if we see the same sort of thing happen in the US in that the psyche of people are that we feel left behind, that there's a hierarchical system that disadvantages the majority of people because economic progress is not proportional to everyone. You could end up seeing a surprise sort of voting system emerge in the US where the left may win,
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
Because socialist principles are on the rise in the psyche of the youth in the industrialized world. And I'm not saying I'm making a prediction about how the election is going to go in the U.S., but I do think that there's a big kind of fundamental change underway here.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
So all these systems ultimately resolve to a two-party system where some minority can hijack one of the parties to enforce their will ideologically. I think that's kind of my point. In fact, I mean, you know, the day after the election, there was this statement on some of their economic priorities. Increase the tax rate to 90% on income over 400K, drop the retirement age from 64 to 60.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
I mean, you know, you go down the list, you know, putting in price controls on free market services and products and goods, this is a lot of what we're seeing kind of repeated in a bunch of different ways. It's all the same story with different characters all over the industrialized world.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
They just lost majority in India, right? Which is the first time in 12 years. And the UK is also up in disarray.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
Not a super majority. Sorry. Yeah.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
Do you think socialist ideologies are on the rise in the youth in the industrialized world? And is that showing up in elections around the world?
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
In the past, socialism has won when this has happened. This has happened. This happened after World War I. It's happened multiple times in history where we've seen the socialists rise in these moments.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
I really hope you're right. I just worry about like the trend of economic globalization has kind of moved every, because it used to be that every country kind of looked like its own country politically. And there's just a lot of alignment happening.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
I think the market's priced in a lot of the expectation already. If you look at the PE chart on the S&P 500 going back five years, let's pull this one up real quick. You can see that we peaked out obviously in 2020, 2021, where we had a big boom with all the stimulus money coming in and all the money found its way into the markets during the end of the ZERP era.
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And then there was the slow wind down as we started to hike rates. and then rate hikes peaked. And now, despite the fact that rate hikes have stopped and there have been conversations about when the reversal will happen, the market's already started to price in that reversal.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
So with respect to like market valuations, we have still seen a rather significant increase in the PE ratio across the S&P 500. Now to Chamath's point, a large percentage of that is contributed to by the top seven tech companies that are driving that ratio inflation.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
But a lot of the market makers have already started to take action, expecting the rate cuts to come in, as you point out, J.K.L., 90% plus likelihood of rate cuts happening this year. So I don't know how much market action we will see. But there has been a lot of conversation from D.C. about the Fed should reset expectations on inflation from 2% to 3%.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
And if they did that, that becomes the new normal. And we're never going to get back to 2%, at least in this current kind of era. that might be the era that we start, the level that we start to see. Oh, really?
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
That's been a big push. Interesting. The Jerome Powell mandate of 2% inflation may be an expectation that cannot be met given the amount of stimulus that went into the economy during COVID that it could take a decade to earn its way out.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
As a result, we will not see a normalized contraction of that capital coming out of the markets in a way that will get us back down to 2% inflation for the time being. And I just saw a presentation by a bunch of food company executives recently, and they took 13 to 15 percent price hikes last year. And you've heard Elizabeth Warren kind of chime on about this.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
But the reality is that inflation is not just in the U.S., but around the world. And it affects the U.S. markets as well, because a lot of U.S. companies have had to raise prices because of their dependence on labor and materials and commodities from other countries that are inflating.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
Exactly. And because of the way that the globalized economy works today, the inflation around the world is going to continue to buoy inflation in the US, even if we get our house in order. So it's very unlikely that we get back to a two-handle, you know, at least in this kind of era.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
And as a result, you'll probably see the market kind of assume that we're going to be at a 3% kind of inflation level for quite some time.
All-In with Chamath, Jason, Sacks & Friedberg
Biden chaos, Soft landing secured? AI sentiment turns bearish, French elections
This is a great chart.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
Those are not... Like these models are trained... and built differently than the language models. I mean, to some, obviously there's a lot that's similar, but there's a lot, there's kind of a ground up architecture to a lot of these models that are being applied to these specific problem sets, these specific applications like chemistry interaction modeling, for example.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
Yeah, that's the important question I wanted to kind of talk about today was this idea of networks of models. People talk a lot about agents as if there's kind of this linear set of call functions that happen. But one of the things that arises...
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In conversation with Sam Altman
in biology is networks of systems that have cross interactions that the aggregation of the system, the aggregation of the network produces an output rather than one thing calling another, that thing calling another.
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In conversation with Sam Altman
Do we see like an emergence in this architecture of either specialized models or network models that work together to address bigger problem sets, use reasoning, there's computational models that do things like chemistry or arithmetic, and there's other models that do, rather than one model to rule them all that's purely generalized?
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In conversation with Sam Altman
There's a bunch of training data, images of proteins, and then sequence data, and they build a model, predictive model, and they have a set of processes and steps for doing that. Do you envision that there's this artificial general intelligence or this great reasoning model that then figures out how to build that sub model that figures out how to solve that problem by acquiring the necessary data
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In conversation with Sam Altman
I guess the real question is, are all these startups going to die? Because so many startups are working in that modality, which is go get special data and then train a new model on that special data from the ground up. And then it only does that one sort of thing. And it works really well at that one thing. And it works better than anything else at that one.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
And now you're getting a. So these models that are predicting protein structure, like let's say, right, this is the whole basis. And now other molecules at AlphaFold3, Can they... Yeah, I mean, is it basically a world where the best generalized model goes in and gets that training data and then figures out on its own? And maybe you could use an example for us.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
Can you tell us about Sora, your video model that generates amazing moving images, moving video? And what's different about the architecture there, whatever you're willing to share, on how that is different?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
It's like a faster unlock. I think so.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
Right. So just as an example, for you guys to build a good video model, you built it from scratch using, I'm assuming, some different architecture and different data. But in the future, the generalized reasoning system, the AGI, whatever system, theoretically could render that by figuring out how to do it.
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In conversation with Sam Altman
Does that mean that there's not going to be long training cycles and it's continuously retraining or training submodels, Sam? And maybe you could just speak to us about what might change architecturally going forward with respect to large models.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
Sam, let me just challenge that. What's the difference in the example you're giving of the model learning about things like song structure, tempo, melody, harmony relationships, discovering all the underlying structure that makes music successful, and then building new music using training data?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
and what a human does, that listens to lots of music, learns about, and their brain is processing and building all those same sort of predictive models or those same sort of discoveries or understandings. What's the difference here? And why are you making the case that perhaps artists should be uniquely paid. This is not a sampling situation.
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In conversation with Sam Altman
The AI is not outputting and it's not storing in the model the actual original song. It's learning structure.
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In conversation with Sam Altman
Where the prompt leverages some artist.
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In conversation with Sam Altman
Would you be comfortable asking, or would you be comfortable letting the model train itself, a music model being trained on the whole corpus of music that humans have created without royalties being paid to the artists that that music is being fed in? And then you're not allowed to ask, you know, artist specific prompts.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
You could just say, hey, play me a really cool pop song that's fairly modern about heartbreak, you know, with a female voice, you know?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
And comment on California's new proposed regulations as well if you're up for it.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
The challenge, Sam, is that we have statute that is meant to protect people, protect society at large. What we're creating, however, is statute that gives the government rights to go in and audit code, to audit business trade secrets. We've never seen that to this degree before. Basically, the California legislation that's proposed and some of the federal legislation that's been proposed
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
basically requires the government to audit a model, to audit software, to audit and review the parameters and the weightings of the model. And then you need their check mark in order to deploy it for commercial or public use. And for me, it just feels like
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In conversation with Sam Altman
We're trying to rein in the government agencies for fear and because folks have a hard time understanding this and are scared about the implications of it, they want to control it. And the only way to control it is to say, give me a right to audit before you can release it.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
I mean, the way that the stuff is written, you read it, you're like going to pull your hair out because as you know better than anyone, in 12 months, none of this stuff is going to make sense anyway.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
By the way, especially if the models are always being retrained all the time, if they become more dynamic.
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In conversation with Sam Altman
That's reviewing the output of the model, not reviewing the insides of the model.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
How are we going to get that to happen, Sam? And I'm not just speaking for OpenAI, I speak for the industry, for humanity, because I am concerned that we draw ourselves into almost like a dark ages type of era by restricting the growth of these incredible technologies that humanity can prosper from so significantly. How do we change the sentiment and get that to happen?
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In conversation with Sam Altman
Because this is all moving so quickly at the government levels. And folks seem to be getting it wrong. And I'm personally concerned.
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In conversation with Sam Altman
But- Well, Mark, what did you learn about that? Yeah, why'd you start it? Maybe just explain UBI and why you started it.
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In conversation with Sam Altman
And it said, we open sourced it to the fans and they've just gone crazy with it. Love you guys. Queen of Kinwa.
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In conversation with Sam Altman
And maybe you can share a little bit about if you're willing to, the motivation behind the action, anything you can.
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In conversation with Sam Altman
It's like, what else is he doing on the side to make money?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
You haven't seen Samad play in the last 18 months. It's a lot different.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
Yeah, I mean, that's a longer conversation because there is a lot of talk about language models eventually evolving to be so generalizable that they can resolve problems pretty much like all intelligent function. And so the language model is the foundational model that yields AGI. But I think there's a lot of people that are different schools of thought on this. And how much...
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
After the break, I think we should talk about AlphaFold 3. It was just announced today. Yeah, let's do that.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
You've said each week, every week that I get to say some names. I did not. I appreciate your interest in the all-in summits lineup, but we do not yet have...
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
It made me sad. It did not make me want to buy an iPad.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
It didn't feel good. I don't know. It just didn't seem like a good ad. I don't know why they did that. I don't get it. I don't know.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
If you think back on... Apple's product lineup over the years where they've really created value is on how unique the products are. They almost create new categories. Sure, there may have been a, quote, tablet computer prior to the iPad, but the iPad really defined the tablet computer era. Sure, there was a smartphone or two before the iPhone came along, but it really defined the smartphone era.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
And sure, there was a computer before the Apple II, and then it came along and it defined the personal computer. In all these cases, I think Apple strives to define the category. So it's very hard to define a television, if you think about it, or a gaming console in a way that you take a step up and you say, this is the new thing, this is the new platform.
All-In with Chamath, Jason, Sacks & Friedberg
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So I don't know, that's the lens I would look at if I'm Apple in terms of like, can I redefine a car? Can I make, you know, we're all trying to fit them into an existing product bucket, but I think what they've always been so good at is identifying consumer needs and then creating an entirely new way of addressing that need in a real step change function.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
From like the iPod, it was so different from any MP3 player ever.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
Yeah, I mean, I'm not sure there's much more to add on the HubSpot acquisition rumors. They are still just rumors. And I think we covered the topic a couple of weeks ago. But I will say that AlphaFold3 that was just announced today and demonstrated by Google is a real, I would say, breathtaking moment for biology, for bioengineering, for human health, for medicine.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
And maybe I'll just take 30 seconds to kind of explain it. You remember when they introduced AlphaFold 2, we talked about DNA codes for proteins. So every three letters of DNA codes for an amino acid. So a string of DNA codes for a string of amino acids, and that's called a gene that produces a protein. And that protein is basically a long, like think about beads.
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In conversation with Sam Altman
There's 20 different types of beads, 20 different amino acids that can be strung together. And what happens is that necklace, that bead necklace basically collapses on itself. And all those little beads stick together with each other in some complicated way that we can't deterministically model. And that creates a three-dimensional structure, which is called a protein, that molecule.
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In conversation with Sam Altman
And that molecule does something interesting. It can break apart other molecules. It can bind molecules. It can move molecules around. So it's basically the machinery of chemistry, of biochemistry. And so proteins are what is encoded in our DNA. And then the proteins do all the work of making living organisms.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
So Google's AlphaFold project took three-dimensional images of proteins and the DNA sequence that codes for those proteins, and then they built a predictive model that predicted the three-dimensional structure of a protein from the DNA that codes for it. And that was a huge breakthrough years ago.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
What they just announced with AlphaFold 3 today is that they're now including all small molecules, so all the other little molecules that go into chemistry and biology that drive the function of everything we see around us, And the way that all those molecules actually bind and fit together is part of the predictive model. Why is that important?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
Well, let's say that you're designing a new drug, and it's a protein-based drug, which biologic drugs, which most drugs are today.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
You could find a biologic drug that binds to a cancer cell, and then you'll spend 10 years going to clinical trials, and billions of dollars later, you find out that that protein accidentally binds to other stuff and hurts other stuff in the body, and that's an off-target effect or a side effect, and that drug is pulled from the clinical trials, and it never goes to market.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
Most drugs go through that process. They are actually tested in animals and then in humans. And we find all these side effects that arise from those drugs because we don't know how those drugs are gonna bind or interact with other things in our biochemistry. And we only discovered after we put it in. But now we can actually model that with software.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
We can take that drug, we can create a three-dimensional representation of it using the software, and we can model how that drug might interact with all the other cells, all the other proteins, all the other small molecules in the body to find all the off-target effects that may arise and decide whether or not that presents a good drug candidate.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
That is one example of how this capability can be used. And there are many, many others, including creating new proteins that could be used to bind molecules or stick molecules together or new proteins that could be designed to rip molecules apart.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
We can now predict the function of three-dimensional molecules using this capability, which opens up all of the software-based design of chemistry, of biology, of drugs. And it really is an incredible breakthrough moment. The interesting thing that happened though is Google Alphabet has a subsidiary called Isomorphic Labs. It is a drug development subsidiary of Alphabet.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
And they've basically kept all the IP for AlphaFold3 in Isomorphic. So Google is going to monetize the heck out of this capability. And what they made available was not open source code, but a web based viewer that scientists for quote, non commercial purposes can use to do some fundamental research in a web based viewer and make some experiments and try stuff out and how interactions might occur.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
But no one can use it for commercial use. Only Google's isomorphic labs can. So number one, it's an incredible demonstration of what AI outside of LLMs, which we just talked about with Sam today, And obviously, we talked about other models, but LLMs being kind of this consumer text, predictive model capability.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
But outside of that, there's this capability in things like chemistry, with these new AI models that can be trained and built to predict things like three dimensional chemical interactions, that is going to open up an entirely new era for human progress. And I think that's what's so exciting. I think the other side of this is Google is hugely advantaged.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
And they just showed the world a little bit about some of these jewels that they have in the treasure chest. And they're like, look at what we got. We're going to make all these drugs. And they've got partnerships with all these pharma companies and isomorphic labs that they've talked about. And it's going to usher in a new era of drug development design for human health.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
So all in all, I'd say it's a pretty astounding day. A lot of people are going crazy over the capability that they just demonstrated. And then it begs all this really interesting question around like, you know, what's Google going to do with it and how much value is going to be created here? So anyway, I thought it was a great story. And I just rambled on for a couple of minutes, but I don't know.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
Sorry, let me just say one more thing. Do you guys remember we talked about Yamanaka factors and how challenging it is to basically, we can reverse aging if we can get the right proteins into cells to tune the expression of certain genes to make those cells youthful? Right now, it's a shotgun approach to trying millions of compounds and combinations of compounds to do them.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
There's a lot of companies actually trying to do this right now to come up with a fountain of youth type product. We can now simulate that.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
So with this system, one of the things that this AlphaFold3 can do is predict what molecules will bind and promote certain sequences of DNA, which is exactly what we try and do with the Yamanaka factor-based expression systems, and find ones that won't trigger off-target expression. So meaning we can now go through the search space and software
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
of creating a combination of molecules that theoretically could unlock this fountain of youth to de-age all the cells in the body and introduce an extraordinary kind of health benefit. And that's just, again, one example of the many things that are possible with this sort of platform. And I'm really, I gotta be honest, I'm really just sort of skimming the surface here of what this can do.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
The capabilities and the impact are gonna be like... I know I say this sort of stuff a lot, but it's going to be pretty profound.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
I mean, simple stuff, but so powerful. And you can filter out stuff that has off-target effects. So, so much of drug discovery and all the side effects stuff can start to be solved for in silico.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
And you could think about running extraordinarily large, use a model like this, run extraordinarily large simulations in a search space of chemistry to find stuff that does things in the body that can unlock all these benefits, can do all sorts of amazing things to destroy cancer, to destroy viruses, to repair cells, to de-age cells.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
I mean, this alone, I feel like this is where I, I've said this before. I think Google's got this like portfolio of like quiet. Yeah. Yeah.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
And the fact, and I think the fact that they didn't open source everything in this says a lot about their intentions. Yeah.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
Jason, I feel like if you didn't find your way to Silicon Valley, you could be like a Vegas lounge comedy guy. Absolutely.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
Somebody said I should do like those 1950s, those 1950s talk shows where the guys would do like the, the stage show. Yeah.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
We have five different kinds of xanthan gum you can choose from, right, Jamal?
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sam Altman
Open source it to the fans and they've just gone crazy with it. Love you, Wes. Nice.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Freeberg, your thoughts on this? I don't know what regulatory... capture NVIDIA? Are you talking about regulatory capture of NVIDIA?
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And it just seems pretty sure one of the silly aspects is they just passed this law in California, Newsom warns against perils. of over-regulating AI. Oh, good. Governor Newsom warned on Wednesday against stifling the burgeoning AI sector. I mean, Newsom is well-informed by the tech community. Sure.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And he's also an intelligent person, so I don't think he'd kind of fall quickly in line on this one. But the way that the statutes were written is there's a definition on the size of a model which in and of itself is very quickly changing. As we know, we've seen recently significant reductions in model size that actually improve performance overall of the model for specific applications.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And it's very likely we end up seeing a lot of more smaller targeted models being used in specific applications instead of one massive general purpose model being used, or networks of smaller models, which is what really where I think the industry is going. And if that's where things go, then the statute doesn't even matter. It makes no sense anymore.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And that shows you, I think, how quickly things are changing. They go and they get, quote, experts' opinions. In a couple of months, those experts come back. They're like, here is the size of a model that you need to be regulating. And then the legislators run and they write the code. They pass the statute. And all of a sudden, it doesn't even make sense anymore.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
So yes, I don't think we really know where this technology is all falling out at this point. And I think it's very difficult to have the government kind of reach in too quickly to try and identify what they should and shouldn't be allowing to happen from a free market perspective.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Nick, can you pull up the image? I'm going to talk about the stupidity of buying the stock of this company at this valuation. This is a company. And then I think we can talk about whether that's even relevant, which I think indication is it's not. GameStop finished the year 2023 fiscal year with Sales of 5.3 billion down from 5.9 billion the year before. So sales declined by 12% in the year.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Adjusted EBITDA for the year was $65 million. And they have about 1.2 billion in cash. Currently, as of today, the market cap is about $13.5 billion. So that makes it about a $12.5 billion enterprise value. 12 and a half billion divided by 65 million of EBITDA means that this stock is currently trading at about 192 times EBITDA.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
A business that is profitable and you can say that the profits are stable and predictable and is likely not gonna grow very much will typically trade for seven to 12 times EBITDA. And the stock is trading at 192 times EBITDA and the revenue is declining 12% a year.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
So I'll just point out, like, I don't think that there's anything about the actual performance of the underlying business and the security that you are buying or selling when you are making a decision about whether or not to buy or sell the security. And I think that that's the real question. It does that even matter? Clearly, it doesn't. Let people have fun. Let them go to Vegas.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Let them play in the roulette table. They know what they're getting into. The disclosures are all there. All the SEC filings are there. All the financials of this business are there. What you're actually buying is publicly viewable. You can look at it. You can make an investment decision as an individual investor and trader.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And you want to blow your money trying to see when the social trends are going to shift one way or another. Let it be your decision.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
There's no law, there's no law that defines why you should or should not buy a security with respect to the diligence you have individually done to determine whether the underlying business is worth the price you're paying. The law says that the businesses
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
that are listing their securities for public trading have an obligation to make disclosures on their financials and any other material events to the public. And they do that through the SEC filing process. That's all out there. And then what you as an individual do with it is up to you. Enough with the nanny state. Go ahead, Sachs.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
By the way, to not invest through advice. The stock is up 40% today. And then there's these reports that came out yesterday on a bunch of very big hedge funds that put very big short positions yesterday on the stock. And it's up 40% today. So we're all going to get margin calls. So this is where you see the same thing that happened last time where... What was that guy's name? The... The capital.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin. Melvin.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Yeah.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Where was the government to save our day? Where was the government to protect consumers?
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
That's the next cycle of the story. The next cycle of the story is where was the government?
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
It's on you. I think the question is, should we make all sports betting legal and all online casinos legal? So if you follow this to its natural conclusion, let people do what they want. Why are all of the other gambling industries so tightly regulated? And why do we protect consumers?
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Have you guys seen this guy? His name is Tim Nacky on Instagram. So what this guy did, this guy's incredible. So this guy went out and he basically bet 10 cents in online blackjack because he's legally allowed to do it where he lives. I think he's in Australia or something. Oh, yeah. That's 10 cents for every follower he has on Instagram.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
So over the last couple of months, he's been racking and racking up the bets. And he ended up doing these $100,000 plus bets because he got over a million followers. He ran this thing up to over a million bucks and he quit. But now he's formed like a blackjack syndicate. So everyone wants to kind of pile in and bet with him.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
I think that there's this really interesting phenomenon of like social betting. Everyone wants to be in a group together. He's got hundreds of thousands of people that have put money in. This is so great. And then he goes and does this online gambling. Nick, pull the video up. I just sent you. Watch how this guy, and he's so entertaining. He's awesome.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
One hand a day. One hand a day.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And every day his follower count goes up. So every day he bets more. And then you're following. And he ran this thing up to a million approximately. Oh, so good. I haven't seen Sax this awake during the pod. You don't get the 10 cents. He keeps it for himself. He started this just by betting his own money. And he would put 10 cents down every day for how many followers he had. Okay.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And so he started betting more and more of his own money.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
So then as of a few weeks ago, or like two weeks ago, he stopped betting his own money. He took the million off the table. He called it a day and he set up a syndicate. And now people send their own money in and now he's betting the syndicate's money. I love this. And he does one hand a day and he keeps racking this thing up.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Man, that would be a good losing video. It's so funny.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Can we get this guy at the All-In Summit? He plays online blackjack, right? So... There's always like a fake dealer and he has all this hilarious commentary on the fake dealer and what they look like. Sax is texting people to set up an account in a VPN right now.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Well, I think part of this is actually, there's been these rules imposed by NASDAQ and New York Stock Exchange that have tried to enforce upon the listed companies, rules and regulations that are not tied to securities. laws, including some of these aspects of diversity of your board.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And I know that there have been a lot of public company board members and CEOs that have quietly tried to push back on these rules, that they're imposing social systems upon, you know, what is effectively a regulated exchange. And so there's certainly like an interest and a pushing for a competitive marketplace for exchanges.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
There was a survey done recently that showed, I got to find some of this data, but it showed the cost of going public on NASDAQ, Amex, or the New York Stock Exchange was about $7.4 million. Cost of going public through an over-the-counter bulletin board listing service was about $2 million.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And then there's these additional kind of rules that are being imposed if you want to be listed on the big boards. So clearly there's interest and it's great to see a competitive market emerge. By the way, there have been other attempts. There's that long-term stock exchange. You guys remember that a couple of years ago that was meant to kind of incentivize long-term holdings.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
There was two other equity security exchanges, efforts made in the last couple of years that didn't take off. So this isn't super novel in terms of like seeing a new challenger exchange step up, but I think more competition is always better.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And I'll say like, it feels like a lot of people are tilted because they defeated Trump and now he's back. And so that tilts a lot of people. There was a lot of effort, a lot of energy, and a feeling of success that Trump was ousted. And the fact that the guy is now the frontrunner to be president again can be very tilting after feeling like you've already won the battle. And guess what?
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
It's back. I will also defend Vinod real quick. I'll say, having known Vinod for a long time, he's an investor with me. He's a guy I've come to appreciate and think highly of. We had him at the summit. It was great at the summit. It was great. It was awesome. If you listen to his thing, he said the listeners of the pod and then he said MAGA extremists. So they're not based in Silicon Valley.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
There's not much to talk about except to highlight this image which shows, again, we talked about this a few months ago, hot ocean temperatures drive hurricane and tropical storm activity because as the wind, the air above the ocean starts to move,
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
the energy from the ocean gets pulled out, you know, like things cool down, the water cools down, but that energy actually goes back into pushing the wind to move faster and faster. And that's how tropical storms, cyclones, and hurricanes are formed, is warm ocean temperatures.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And there's been this kind of persistent warming since last year in the Atlantic in this particular region where all the hurricanes form. And normally the hurricane season starts kind of call it August to October. Right now, we are seeing temperatures that are so far beyond what we've seen any time historically.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
This image that you're looking at here actually compares the ocean temperatures right now in the Atlantic to where we were at the same time period in 2005, which was a record hurricane year, obviously with Hurricane Trina, right?
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And so the National Hurricane Center, a lot of the climatologists are forecasting that over the next couple of months, we could see and should expect to see probabilistically much larger, stronger, bigger, more frequent hurricanes than we've ever seen historically. So we'll see if it plays out. Just a very small tidbit of news to share. Thought it'd be worth highlighting.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
I think he was referencing that the listeners of the pod are not based in Silicon Valley and they are MAGA extremists.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
We have not seen in the modern era temperatures in the ocean like we're seeing now, that's a fact. I'm not gonna do this whole big prognosis on everything all in one, because I think that's where people feel like there's room for discrediting things. Yeah, that's why I'm trying to atomize this. Yeah, we can be very specific about things. Here's an example.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
I think what he meant to say was and some of the supporters there are not based in Silicon Valley, meaning like the supporters.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
So this is the sea surface temperature going back to 1981. And as you can see, at this point in the year, and the temperature oscillates because of the way the earth tilts towards the sun, And so at this point in the year, we are seeing right now sea surface temperatures that are beyond anything we've seen historically, and it is continuing to climb.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
So if this does not taper off or level off, we will see record sea surface temperatures in the August to October timeframe, which will almost certainly push massive hurricane events out of the Atlantic, and they will find their way towards the continental US and Mexico.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Simply data. It's just data, right? It's simply data, right.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
One of the theories... So there's theories about El Nino. There's theories about climate change contributing to this. There's also a theory about sulfur dioxide that has now been banned in shipping and cargo vessels that go across the oceans. Last year, they banned sulfur dioxide use in the fuel that's coming out of these. And sulfur dioxide actually reflects sunlight.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
So as it goes up into the air, into the atmosphere coming out of these ships, it actually blocks and reflects light. So that would make the oceans cooler. And so a lot of folks have said that over the last couple of decades, we've actually dampened the temperature and the warming that's happened on earth because of all the sulfur dioxide we've been putting up into the atmosphere.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
But because sulfur dioxide causes acid rain, environmentalists have been pushing for years to ban sulfur dioxide. The problem is with banning sulfur dioxide, you may have this other side effect, which is now more rapid increased warming of the surface and of the oceans.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
There is a reduction in biodiversity that's underway. We can see that using data. But to Chamath's point, Humans have prioritized the progression of individuals forward. China had a billion people that came out of poverty in 30 years. And they came out of poverty because of the industrialization of the production of consumable goods that that population gets to consume.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
They get access to more calories. They get access to more foods. They get to have cars. They get to have houses. All of that, making cement, making concrete, all of those things require industrial systems. And those industrial systems have a cost. That cost is the dollar economic cost, which we're kind of rationalizing with greater productivity. Then there's this whole cost that's externalized.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Got it.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
So that's the tension is like, if you're wealthy, if you're a wealthy nation, if you're the Western Europe or the United States, you get to stand up and say, stop carbon. But if you're the rest of the world, you're like, I want to have a home. I want to have a car. You want to have the same evolution stuff that America went through or Europe. I want to progress as a person.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
I want to progress as a society. And that's the tension that makes this a very difficult problem to resolve, which is how do more of the world get to progress while being cognizant of the long-term effects.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
I am deeply optimistic. So let me just say this.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
I believe strongly that there is a strong relationship between the output of atmospheric carbon and the deleterious effects we see in ecosystems. Okay. That is something I feel like is true from data. I am not, however, as pessimistic
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
pessimistic that the world is going to end in the next decade or two because I see improvements in productivity, meaning how many units we get out for every unit in or how many units we get out for every unit of carbon that's emitted. And those productivity, meaning better technology systems, are rapidly changing how we make things and how people are accessing goods and services.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And I think that that's why I am like, because I'm a techno-optimist, I'm optimistic about where things are headed. Gotcha.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And it is also why I get very angry and upset about any efforts or attempts to slow down the adoption of technology, because these things will pull people forward and make that happen faster without all the deleterious side effects that we've unfortunately had to do in the absence of technology.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
The unfortunate reality in a voting system, an election cycle like we're in, Vinod went and did a fundraiser. It's public, but he did a fundraiser for Biden a few weeks ago. And he wants to win the election. He wants to make his horse win. There's a lot of reasons why I'm sure Vinod has chosen that person to be his horse.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And so when you get on the playing field, you got two teams and only one team wins. So everyone pulls out all the stops to win. One of the things that is done is unfortunate and it over time causes an erosion and a hardening into a kind of polarity between all people, which is that you call the other side wrong or bad or extreme. The term that he used, which really I think
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
personifies the problem is he said their listeners are their MAGA extremists. Extremists being the word, right?
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Whatever. The extremism phrase is used by both parties to describe the points of view of the other side. And what I think is lacking is a reshifting of the perspective to say their views are valid. I acknowledge their views. I hear them. I know why they feel that way. I'm understanding where that group of people are coming from.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
And to have that acknowledgement unfortunately softens and weakens your position and ability to go out and win an election. And so both sides harden themselves and use terms like this. to try and discredit the other side. So it's unfortunate to see, I think we all understand where someone who's trying to win a battle on the field is coming from when they're trying to do this.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
But I do think that what is deeply lacking in the erosion that's arisen is because we can't say, I hear you, I see the problems, I recognize you as people just like us, you have kids, your families, and you have a different point of view on the policies that will work and the individual that will realize those policies.
All-In with Chamath, Jason, Sacks & Friedberg
DOJ targets Nvidia, Meme stock comeback, Trump fundraiser in SF, Apple/OpenAI, Texas stock market
Here's the point. It happens even worse offline when we're not on the show. It's unbelievable.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
I'm hanging in there. I'm just waiting for the shoe to drop, J-Cal, and what you're going to do to blow shit up. But I think we're almost there, so we're super excited. We have speaker names going out today, so we'll talk a little bit about who the speakers are. You guys know your bestie, Elon, will be there. Cool.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
I mentioned this when we had our conversation in 2020 around governance and why governments seemed to not be able to synthesize different data to make decisions. They were being told what to do by their subordinates. The difference for me is leading versus managing. That a traditional manager, and I've seen this at a lot of companies. I even saw this a lot at Monsanto. The manager...
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
says to the people that report to them, what are you guys going to do? And then the people, they go down to the people that report to them and they say, what are you guys going to do? And so you end up net-net developing this kind of bottoms up model for the organization, which is effectively driven with a diffusion of responsibility. And as a result, the lack of vision.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
Okay. Third year in a row. He's the only repeat this year. We've got Mark Benioff joining us for a conversation about the future of enterprise. We've got Barry Weiss from the Free Press. We've got Arizona Senator Kyrsten Sinema. We have John Mearsheimer and Jeffrey Sachs to talk about geopolitics with David Sachs, Sachs on Sachs. Nick Asherora. Nick Asherora.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
The leader says, here's what we are going to do, and here is how we are going to do it. And then they can allocate responsibility for each of the pieces necessary. And the leader that's most successful is the one that can synthesize the input from the subordinates and take that synthesis to come up with a decision or a new direction, rather than be told what's the answer by the subordinates.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
So leaders, I think fundamentally are able to number one, understand the different points of view of the people that report to them. Number two, set a direction or set a vision, really clearly say, this is where we are going. And then number three, figure out how to allocate responsibility to the people that report to them to achieve that objective.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
Whereas a manager is typically being told what's going to happen in the organization, like a giant Ouija board with 10,000 employees hands on the writing thing that go around and try and write the sentences. And ultimately you just get a bunch of gobbity goop.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
As companies scale and they bring in these quote professional managers, they're typically kind of looking down and saying, hey, what are we gonna do? What's gonna happen next? And they're not actually setting a direction, whereas someone who's a founder typically feels the authority to be able to set the direction. But to Chamath's point, Satya Nadella, Sundar, Nikesh, Tim Cook, a great example.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
There are some really great leaders that have run organizations that are already scaled and then taken them to an order of magnitude or two orders of magnitude beyond where they were when they step in. So I don't think that there's necessarily a founder.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
By the way, what's important about what you just said, Chamath, is that that is effectively, I think, the definition of like being a successful founder, understanding from first principles. So these are leaders that can think from first principles, not necessarily from comparables.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
Most managers are taught in business school, here's how a business is run, here's how this person did it, here's how this company did it. And then they go and they try and cookie cut or repeat that. That doesn't really work because every business, if it's going to be successful, it has to be unique.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
And so the ability to actually think uniquely and identify from first principles, the means necessary to achieve the mission of the organization, I think is a critical, critical leadership trait. Maybe that, yeah, that leader can come from a founder or not, but this ability to kind of, yeah, ignore convention, ignore comparables and think for yourself.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
Well, building a unique business. And I think if you look at Airbnb, and I'll give Brian Chesky incredible credit for this, you look at Uber, you look at how Steve Jobs built Apple, what every one of these businesses have in common is that they were all built in a unique way.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
And I think that's what makes great businesses is that they identify their own path, their own unique path for how to operate a business to scale to achieve the mission of the organization.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
And I think that that's what's typically lacking in trained managers who use comparables and biases from their prior experience and what they've been trained and taught to use as a cookie cutter type model, which doesn't create unique value. It makes your business look like the other, and ultimately it commoditizes some aspect of the business to the point that the value of the business goes down.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
We've got the legend, the legend from LA, Michael Ovitz, joining us. Love that book. We're going to get into some really cool tech.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
But to build something unique where you're constantly finding the unique path that gives you an advantage is what all of these companies have in common. Whether that unique path was made by an experienced hired person or a first-time founder, it's this ability to kind of build a unique competency that I think makes them all distinct as a group.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
J. Cal, you've interviewed thousands of founders, CEOs you've seen successful, unsuccessful. Do you have a point of view on whether this concept applies and if you have a general kind of heuristic for the difference between success and not success?
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
Man.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
It's a really interesting mix. We've also got some cool panels on tech and robotics. So we're doing all three of the big eVTOL companies, Joby, Archer, and Wisk, and their CEOs are going to be there. Gecko Robotics. So we've got Jake coming from Gecko to actually do a really cool product demo. We have the CEO of Waymo, Takedra Mawakana, joining us to talk about autonomous driving.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
Juan Carlos Belmonte talking about age reversal. from Altos Labs, probably the most funded private company in history. And also Ingo's coming out from Europe from Adyen, CEO of Adyen. You guys may not know this, but Ingo has never done a US conference before. So this is his first public speaking event at a US conference.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
Great topic to talk about. And huge shout out to my boy, Woody Hoberg, US astronaut, joining us to tell us about his months aboard the ISS, his experience.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
and captaining the Crew Dragon capsule back to Earth. From Uranus. And the future of spaceflight and Uranus, yes. To Uranus. To Uranus. Thank you, everyone.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
You know what happened, J. Cal? It's like me and my guy Draymond, you know, champions. Did I tell you, you know how I met Woody? He's a huge fan of the pod. And then he NASA astronauts, which I follow on Twitter, DM me, and they're like, Woody would like to meet. And I'm like, What? And then I get this message from Woody. I'm like, Is this real? He's like, I'm on the ISS.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
I listen to the pod every week. I love the show. And you guys, you know, keep me entertained up here in space. And I'm like, No way. So then he's like, Can you do a zoom? And I'm like, Sure. So we hop on zoom. And I you guys saw this thing. I put it out on on Twitter or something. But I did the zoom with Woody got to know him hang hung out with him since he's been back. Great guy. So
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
Well, Eric Schmidt came into Google through his relationship with John Doerr. And John Doerr, as a mentor to Larry and Sergey, an investor in Google, had suggested that they bring in a professional manager that can help them successfully scale the business. And John had this relationship with Eric and Larry and Sergey started to socialize with Eric and it was a very long process.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
And they ultimately respected Eric because of his technical capabilities and technical background, which was quite distinct from the other candidates that they had met during this process. but it was necessary. They were first time, they'd never worked anywhere. They'd never had a job. They had never had experience.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
I think similarly, Sheryl Sandberg as a partner to Zuck ultimately helped him level up and obviously Chamath and others prior to that. But these first time founders that haven't had any sort of work experience and have no concept of kind of organizational dynamics and the challenges that will arise as you try and build and scale a team to execute a mission,
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
typically need to have some degree of counseling, mentorship and support. And so bringing in that degree of experience with someone who's ready and willing to partner with the founders, meaning not necessarily direct them, but partner with them and help them learn as Eric did, and then ultimately handed the reins back to Larry.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
And as Cheryl did, and ultimately Zuck continued to kind of lead the company. have been really powerful enabling forces. But Chamath is right. The early days of Silicon Valley venture capital were really framed around this concept where you find some smart technical founding team, and then you bring in a professional manager.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
But that's because so much of the origin of technology in Silicon Valley was about selling technology into an enterprise. So there was kind of a bit of a tried and true business model and business structure that made sense. The new era since the internet has been quite different. Every business model imaginable has been reinvented in Silicon Valley.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
And so success, I think, has largely arisen in reinventing businesses, reinventing industries by kind of novel independent thinking leaders, not necessarily bringing in experienced managers to scale up a known business model.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
What do tall, beautiful, intelligent women call me historically? What do they call you? They call you. They don't.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
They're like, can you park my car? And then really excited to have Thomas Lafont come and give us a State of the Union on public market and private market tech investing. He's got a really interesting presentation he's going to share. So a lot of the content from the summit, we're going to be pushing out.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
Oh, sorry, co-founder of Co2, yep. And so a lot of the content we're gonna be pushing out on YouTube as quickly as we can. Obviously some of the more timely, newsly stuff we'll get out first. And then as we did in the last two years, material will roll out in the days and weeks that follow. We do not do sponsors here on the All In Podcast, but the All In Summit does have sponsors.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
So a huge shout out. Partners. Which we would never otherwise do, partners. to Excel Events, Hexclad, Merch.com, Athletic Brewing, The Ridge, the greatest law firm on earth, Cooley, Velocity Black, and our big enterprise software partnership sponsor, Google Cloud. Big shout out and big thanks to Google Cloud for stepping it up in a big way.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
I'm not sure that giving people a choice of an algorithm is going to work. Consumers just want to have stuff that incites emotion. There's a reason, you know, horror movies do well and also romantic comedies and also adventure films, like they're all emotive.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
At the end of the day, the more emotive something is, the more emotionally inciting it is, the more likely you are to kind of want to have something like that again. And so that's simply the nature of how, you know, humans interact with the world around them.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
When something is emotionally inciting, you want more of it and you get more of it and that creates the dopamine and that drives the behavior. The crazy thing about social media or digital media, firstly, is that the cycle, the feedback cycle is much faster.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
Used to be that you put out a book, you wouldn't get the results on how the book sold and how many people liked it and how many people read it till a year later. And then with movies, you get results in a weekend. But with social media, you get results instantly. When a piece of content comes out online, you get an instant result.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
And then with the concept of a feed, where the next content is dynamically selected for you based on your reaction to the content prior to it, you kind of get this immediate feedback loop that then tunes and lines up the next thing. And now you're getting hundreds of iterations an hour.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
So I'm not sure that there's really this like simple solve where let me show you something that's like less inciting. At the end of the day, if it's something that's horrific or something that's romantic or something that's inspiring. If it's emotionally kind of activating enough, you're going to be happy watching the next one. You're going to keep watching and you're going to keep watching it.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
They have an incredible set of AI tools that they're making available to startups. Startup founders that are attending the summit get 350,000 bucks in Google Cloud credits. Wait, what? So thanks. Each startup? Each startup, yeah. I would have sent all my companies to this. Exactly.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
Yeah. Like if you go on YouTube, I got, I love watching like videos of mountain biking and I see like all these crazy mountain biking videos now. And I'm, and I love watching them. I'm like, dude, this is awesome.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
There's a decay function. That's right. Yeah.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
You pay $7,500 for a ticket, you get $350,000 in credit. $350,000 of credit. That's incredible. For Google Cloud, it is up to $350,000 in Google Cloud credits.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
It's 50 days before the election.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
for eligible AI startups, which they can use over two years. Comes with a bunch of other benefits. So yeah, it's pretty awesome. Really glad they're doing this and they're gonna have a big set up.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
Yeah, for AI startup founders, they can sign up for Google Cloud. They get 350,000 credits that they can use in over two years.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
You can't do that. It's against the terms of service, but thank you to our friends at Google. We did get a funny note from JCal this morning asking if his remaining friends and family tickets could be sold off so he could grift himself some money off of our free allocation. I was like, hey, what can these go for?
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
What are your thoughts? No passionate thoughts, J. Cal. Did any of you guys see that video I sent you of Kamala's campaign speech in New Hampshire yesterday? Summarize it for the audience, yeah. She fundamentally pivoted from a lot of the statements she made a few weeks ago that I think caused a resounding amount of commentary about being anti-business anti-economic prosperity.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
A lot of people call these comments socialist in nature. And apparently, she heard the feedback and is now pivoting the message and pivoting the policy. So, you know, I think the one question to understand is how real is the pivot and how much is this about getting elected? She made a couple of key announcements at this campaign speech yesterday.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
The first one is that she started out saying that small businesses are the lifeblood of our economy. She's proposing that we increase the startup tax deduction from $5,000 to $50,000. So if you start up a new business and you're generating profitable income, you can deduct up to $50,000 on the year that you start the company up.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
She made an emphasis on getting rid of red tape and deregulating a lot of aspects that make it hard to start companies. She talked a lot about the importance of venture capital and venture dollars, and that there's a goal to spur 25 million new SBA loan applications by the end of her term, so in the next four years, which would be a massive increase in government lending to small businesses.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
She also stepped back the capital gains tax proposal that was made by under the Biden administration that she previously said was her policy as well. and is now proposing a 28% capital gains tax instead of the 40 something percent that I think was the previous proposal. So a 28% capital gains tax only applied to households with a net worth greater than a million dollars.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
But towards the end of her speech, she still talked a lot and got a lot of cheers around the idea that billionaires and big corporations need to pay their fair share. and that there needs to be methods of increasing the taxation of billionaires and big corporations as they're kind of classified by her and some of the other Democrats. So I don't know, is the pivot real?
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
Is she becoming more pro-business? Is she responding to the critical feedback she's received over the last few weeks? Or is this just about getting elected? Is this gonna persist? Is this a change in policy, Chamath? I hand it over to you.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
He's actually answering your question. He's answering your question, J. Cal. He's saying that they're not real policy points.
All-In with Chamath, Jason, Sacks & Friedberg
"Founder Mode," DOJ alleges Russian podcast op, Kamala flips proposals, Tech loses Section 230?
I'm here for the team, J. Cal. It's a team sport.
All-In with Chamath, Jason, Sacks & Friedberg
In conversation with Sheryl Sandberg, plus open-source AI gene editing explained
David Sachs had a last-minute board meeting, so he will not be joining us.
All-In with Chamath, Jason, Sacks & Friedberg
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Why are the feminist groups finding themselves aligning more with Hamas than they are with this core, what seems to be and should be a core ideology?
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Cheryl, let me ask, because I think it's important to note, some people will counter and say, look at this article from Grayzone. Grayzone said Western media concocts evidence that the UN report on October 7th sex crimes failed to deliver for March 7th.
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They said Western media promoted a UN report as proof Hamas sexually assaulted Israelis, yet the report's authors admitted they couldn't locate a single victim, suggested Israeli officials staged a rape scene and denounced inaccurate forensic interpretations.
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I just wanna give you an opportunity to respond to Grayzone's article, because I think a lot of folks have pointed to that article and the articles that that organization has put out as being representative of an alternative view that the sexual violence maybe didn't happen as evidenced in your film. Maybe you can address it, give you a chance to do that.
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Just as a follow-up, what is the social and political motivation of a group like Grayzone and other appointed deniers? What are they trying to accomplish by denying?
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because even they understand that it is not- Because the sexual violence taints it in a way, right? As opposed to just being soldiers killing soldiers, the sexual violence aspect of it taints the valor of the resistance. Is that a fair way to summarize it?
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If there was no sexual violence, would it be fair to call it a resistance? I would not call it a resistance.
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Sexual violence. I think like for us to have a path towards peace, there has to be a degree, despite the pain being felt, a degree of empathy for the other side's desires, the other side's pain, the other side's feeling that they were enacting a resistance against an oppression. How does one side embrace that aspect having gone through this? How do we get to a point
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that a people can say, I have empathy for the resistance after feeling this sort of pain. And this is the age old story of war, eye for an eye, it never ends, it always goes on. What's the right path here to hear the other side, to hear the kids on campuses, to hear the people in Palestine, to hear the world saying, we feel free Palestine after going through this?
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If you were Netanyahu, what would you do differently? I'm sorry for cutting you off.
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Why has the other side captivated so much of the youth in the United States? You're very close to Harvard. Maybe tell us what's gone on at Harvard over the last few years. How did we end up in this place where so much of the youth is so sympathetic to the Palestinian cause? and not as moved as you are by the trauma experienced on the other side.
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What's going to happen at Harvard? What's going to happen at the Ivy Leagues?
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Yeah. But not violent. I went to Berkeley. It wasn't lunch without a protest. I mean, that's like the daily thing you do there. You know, you go grab a sandwich and you go protest, you go back to class. Like that was great.
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I think things are very different. Yeah, I think things are very different.
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But if you feel deep down in your heart that it's a matter of life or death, don't you feel justified that having an encampment, setting up a tent, living there, showing that that degree of conviction is necessary because you're saving lives versus, hey, I think something is a good idea. Let me go protest for an hour during lunch and then I'll leave. It's never going to move the needle.
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The question I'm asking as a young person is how do I move the needle? And there's not a lot of ways that people feel empowered to move the needle. So it seems rational to me to some degree that they want to go into these encampments and they want to do something strong and show their conviction. But again, I think that there's a question on how much truth is anyone willing to see?
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How much are folks willing to embrace the other side? How much are they willing to listen? I see very little listening, very little dialogue going on because then you put up a list of demands that are unmeetable. And, you know, you deny anyone to have a conversation and you deny listening to the other side and you take this hardened view that doesn't allow for progress.
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And I think it's the hardened views on all sides that's limiting progress entirely. Unfortunately, the youth have been subsumed by this. And it's really frustrating to see because I worry about what that leads to.
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as complicated as that may be to do, it is incredibly important so that you can create- And doing so does not dissolve empathy for the other side's cause or for the other side's motivations or objectives. Having empathy for the circumstances that happened here is the equivalent of having empathy for the plight of the Palestinian people and what they're dealing with today following October 7th.
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And I think that we need to recognize that both things can be true. We can have empathy for both sides.
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Take a break. We'll come back. Let's take five, 10 minutes.
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Yeah, Berkeley-based startup, ProFluent Bio.
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Have we talked about CRISPR and gene editing before on the show or no?
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So there's debate around who discovered CRISPR-Cas systems first and found their application, but generally... Whose side are you on?
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MIT is an open source guy, which is why I'm excited about this topic today. Because I don't give a I think things that are in nature are in nature. And I don't think you should be able to pat. I don't think you should be able to patent stuff that you discover in nature.
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So CRISPR, CAS, CRISPR, CAS, CAS, Cas proteins, C-A-S proteins, are proteins that can go in to a cell, and they have what's called a guide RNA, little piece of RNA attached to them, that allows that protein to find its way to a specific point in DNA in that cell, in the nucleus of that cell. And when that protein hits that specific location, it cuts it like scissors.
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And so the protein finds the part of the DNA it's looking to cut, attaches itself, cuts the DNA, and a cut is made. And so this capability was discovered actually in bacteria, and it was an evolved system that bacteria developed to actually protect themselves from viruses. So the CRISPR-Cas complex emerged through evolution where bacteria started to figure out that they could cut up viral DNA.
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So they made these proteins. These proteins would attach to viral DNA and destroy the viruses that came into the bacteria cells. So scientists, arguably from Harvard, from Berkeley, and from other places around the world,
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in the early 2010s started to do research and identified ways that we could leverage these proteins that we were discovering in nature to do targeted DNA editing in human cells and plant cells and other cells. So rather than them just being used as a defense mechanism by bacteria, that we could harness these proteins and make them useful to go in and do specific gene editing.
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Now, why would we want to do gene editing? Gene editing, if done precisely enough and efficiently enough would allow us to go in and fix genetic diseases in humans, for example. It would allow us to take T cells and reprogram them to go and attack cancer cells back in the human body.
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It would allow us in the case of agriculture, which I'm very close to and what I work on every day, to figure out ways to make specific changes to the genes of a plant, to make that plant grow in higher yield or change itself to be disease resistant or drought resistant or other features that might be helpful to agriculture and to humanity.
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So gene editing became this amazing toolkit that emerged around 2012, 2013, and just blew up on the market. And the main original foundational patents, which are now mostly held after a lot of litigation by the Broad Institute, which is, you know, there's this kind of joint patent arrangement with the Broad and MIT and Harvard,
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are being used in medical applications are being used in agriculture applications, they're being used in all these different tools, but they're patented, there's royalties, there's fees, all this stuff. And in the years that followed, many other cast proteins started to get discovered all these different types of proteins were discovered.
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And the reason you want to use different proteins is you want to improve the efficiency. So how frequently or how good are these proteins at editing the cell, and eliminate off target effects, meaning the protein isn't making cuts or making changes to other parts of the DNA that you don't want it to.
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So there's been this search underway for the last decade for new cast proteins and developing new cast proteins. And dozens have been discovered. People are trying to patent them, people are trying to make them do special things, they can only change one letter. All these different tools are emerging.
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So we went from having absolutely no ability to do gene editing just over a decade ago to suddenly having all of these different tools that could do gene editing really efficiently, really cheaply, really affordably, really scalably, and more precisely. So this company, ProFluent, they actually used an AI model, what they call a protein language model.
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to create and train an entirely new library of cast proteins that do not exist in nature today. So they basically took 26 terabases, so 26 trillion letters of assembled genomes and metagenomes, this is from various species, and start to simulate new cast proteins that could be useful to replace the ones that are on the market today or improvements on what's in the market today.
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And they found one that they called Open CRISPR-1. And they made it publicly available under an open source license. So any startup, any research lab, any individual, any scientist can use this particular Cas protein to go in and make edits without having to deal with patents and IP and claims on who owns what that they found in nature. And this particular
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protein that they identified is 400 mutations away from anything that they've seen in nature. So basically, the AI model started to learn what sequence of DNA generated what structure of protein that was really good at being a gene editor. And they started to discover and iterate on building new ones. And the AI started to predict, hey, this would be a good gene editor.
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This would be a good gene editor. And they came up with dozens of new gene editing molecules that don't exist in nature today. They identified one that they then sequenced. They created it. They put it in a lab. They tested it. And it turned out to be much better than Cas9, which is the main one.
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To find a new cast protein. So the guide RNA is just RNA that's like the key Think about a CRISPR-Cas system has two components. One is the Cas protein. That's the giant protein that goes in and cuts DNA. And attached to it is what's called a guide RNA. That guide RNA is the specific letters. And those specific letters are like a key in a lock. They go attached to a particular part of the DNA.
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And then that giant protein cuts in that exact spot. And so what everyone's been working on is new proteins. And they've been trying to find new cast proteins that aren't gonna go do off-target cutting, that aren't gonna make mistakes, that are gonna be perfect at making the exact cut you want to make.
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So everyone's always trying to improve the efficiency and reduce the off-target effects of these systems.
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And so what they did is they tried to create a new protein that doesn't exist by learning from all of these other cast proteins that exist in nature today and identifying the three-dimensional structure of them and allow the model to predict a cast protein that might actually be better than anything that's found in nature today.
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Well, that's going to be tested in the courts later, I'm sure. But they open sourced it. So they're not claiming any IP on it. They're not making any claims on it with the patent office. And they're saying, look, it's free and available.
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That's such a leap.
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There's a simple truth to all this, which is every single life sciences lab on earth is using this technology today. It has absolutely revolutionized life sciences. It has changed everything. It has reset the trajectory of human health, of agriculture, and of industrial biotechnology. Those are the three major markets where gene editing is useful. It is changing everything.
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And so it is already a ubiquitous tool. We basically created software engineering for DNA, for life, with this capability. And so this system that these guys just published on, I think is a really wonderful... manifestation of how AI is allowing us to open source and create improved tools. And it's, it's really important for humanity. And so I think it's just great to see happen. Yeah.
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The number one choice, yeah. The number one choice. Yeah.
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I'm not super familiar. I've met the ProFluent guys a couple of times. I'm not super familiar with what their business model is going to be. But I hate that startups are worried or feel encumbered by... the patent landscape associated with CRISPR-Cas systems, and that they can't build novel products and move humanity forward.
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I'm hopeful that we do see more of these open source-like tools become available and ubiquitous. It's almost the equivalent of having Linux, where everyone can now, you know, as an operating system, or HTML being, you know, standard code. I don't know if you remember to use... Before HTML5, a lot of people were using Macromedia Flash in the browser.
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It was a huge blocker. So you had to pay the license fee to create Flash content, and then you had to, I don't know if they sold consumer plugins.
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And they were trying to make money on both sides.
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Yeah, in order to put multimedia on the internet, you used to have to pay license fees. And then HTML5 basically created multimedia capabilities native to the HTML, which is open sourced, and so everyone could do it. And I think that it's really important that we see that happening with gene editing.
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I think all the applications of gene editing should be patentable and protectable, but the core tools are so powerful and important that I think it's very difficult and hard to see how we are accelerating humanity's progress. by keeping these things at bay. And it's really great to see open source tools like this hit the market. And I think it's really important.
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And I think it's really amazing to see AI create them.
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Well, they created their own LLM. They call it a protein language model. So they took all of this genome data that is generally very publicly available. There's a lot of this stuff published in open genome databases. You can download it, ingest it, and use it for whatever purposes you want as a life sciences researcher.
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So they took 26 trillion base pairs of data and basically used that to train their model. And then using that trained model, they then started to run inference on it to say, come up with cast systems that are novel, that could theoretically have efficacy greater than what we see in nature with the natural cast systems.
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And then the model started to output all of these novel proteins, then they started to test them. And they found that this one worked really, really well after testing in the lab. So actually, here's a great image. So here you can see basically in training the model. So it's a little bit technically complicated what they did in the steps to generate this system.
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But ultimately, the system yielded something that they could then create, put in a lab environment and in the lab environment test how well it worked. And what they showed was that it actually worked better than cast nine, which is the primary gene editing protein use today. So, you know, pretty powerful set of steps and all unlocked by, again, freely available data,
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and building their own model and now ultimately open sourcing the best output of it.
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All he'd have to do is just take excerpts from the show.
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Now that's something that would be a benign tweet from real tomorrow.
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Please do your best impression.
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Yeah, reason number 756 to go to Vegas. No sales tax on Laura Piana. This is in 2012, by the way. Very precious. If you dress like me, I won't initially think you are a D-bag.
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I mean, this is when... Cheryl, before we get started here... Cheryl should read that last one. That's really good. All right, Cheryl, you get the last one.
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Anybody has the right to mock Chamath. I mean, you've had to watch his growth over 20 years. You've had to suffer.
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Anyway, the secret's out. The secret's out. The secret's out. My guess is that Twitter handle is about to get popular again.
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So let's just keep that in mind here, folks.
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And we're not journalists. We're not.
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We're not traditional journalists. We're friends talking, trying to understand stuff. And just to be clear, I know a lot of commentary comes back. Well, why didn't you say this or ask this? And, you know, I think we're just when we have guests on, we just want to talk with them like we would in a living room and have a conversation.
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Well, I just want to zoom out because I think, Cheryl, we had, I believe, a couple of conversations after October 7th. Amongst other folks, I've heard that
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There's been a lot of disappointment that institutions, organizations, ideologies that have been supported by folks like yourself, or maybe you can speak, I don't want to put words in your mouth, suddenly emerged to be something quite different when
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threads of antisemitism started to emerge and folks began to deny certain things based on their ideology about the oppressor-oppressed concept being applied to Israel and Palestine.
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And maybe you can tell us a little bit about the surprise and journey that you've been through since October 7th with respect to some of the groups that you've supported that suddenly seemed quite different than what maybe we all thought they were. prior?
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Look, it's a great question because, I mean... Sorry, and that's the conversation Cheryl and I have been having that led to saying, hey, why don't you come on the show this week and let's talk about this and other topics, particularly given the timing with the release of the film.